by Staff Reporter | Feb 20, 2026 | News
By Staff Reporter |
The Republican-led Arizona Senate is advancing legislation aimed at increasing oversight of Gov. Katie Hobbs’ handling of contracts.
On Wednesday, the Senate Regulatory Affairs and Government Efficiency Committee passed Senate Bill 1186 (SB1186) along party lines: Republicans in support, Democrats against.
State Sen. Mitzi Epstein (D-LD12) said she opposed the bill because it wasn’t “ready for primetime.” Epstein raised a concern that private companies could be impacted under the current way the bill is written. Epstein was the only one to explain her vote.
“Influence peddling is a bad thing, and we want to make sure in all aspects of government, including in this body, that people cannot pay for play,” said Epstein.
The bill would require companies currently holding or vying for state contracts or grants to disclose anything of value provided within the preceding five years to the governor, including anything beneficial provided to campaign or inauguration-related activities or outside organizations supporting or opposing the governor politically.
It would also prohibit state agencies and state employees from destroying any notes taken during evaluation of a company responding to a request for proposal on a state contract or grant. Should any state agency or state employee destroy their notes, any agreed-upon contracts could be solicited again.
Gov. Hobbs remains under legislative investigation over allegations of a “pay-to-play” relationship with Sunshine Residential Homes. That company received a unique rate increase following their donations to Hobbs. This legislation was inspired by that ongoing controversy.
Senate leadership to include President Warren Petersen (R-LD14), President Pro Tempore T.J. Shope (R-LD16), Majority Whip Frank Carroll (R-LD28), and Majority Leader John Kavanagh (R-LD3) all issued statements endorsing the legislation preceding the committee vote.
“State government has a responsibility to ensure taxpayer dollars are awarded through a fair and competitive process people can trust,” said Petersen. “When billions in public funds are at stake, the rules must be clear, consistent, and focused on delivering the best value for Arizona families.”
“After vetoing our bill last year, the Governor came back this session with her own proposal, but it still leaves the biggest gap untouched,” said Shope. “Her plan focuses on releasing information after contracts are awarded. Our bill requires transparency before decisions are made, when it actually matters.”
“The scandals we’ve seen show what happens when government oversight fails,” said Carroll. “When billions of taxpayer dollars are being spent, mistakes or favoritism don’t just stay inside government, they affect services families rely on and erode public confidence.”
“Arizona’s contracting laws were written for a different era and leave gaps that agencies can’t effectively police today,” said Kavanagh. “SB 1186 modernizes the rules by setting clear disclosure standards and establishing enforceable safeguards that strengthen the contracting process itself.”
Earlier this month the bipartisan advisory team put together by the Republican-led Arizona House brought on outside counsel from out of state for an independent investigation of the connection between Hobbs and Sunshine Residential Homes. The counsel, Justin Smith, is representing President Donald Trump in his defamation lawsuit against E. Jean Carroll; Smith’s law group was founded by Trump’s solicitor general, D. John Sauer.
AZ Free News is your #1 source for Arizona news and politics. You can send us news tips using this link.
by Warren Petersen | Feb 12, 2026 | Opinion
By Sen. Warren Petersen |
Over the past couple of months, the nation’s eyes have (rightfully) been turned to the State of Minnesota, as concerned citizens have unearthed what appears to be significant abuses of taxpayer dollars going to seemingly fraudulent daycare and healthcare centers run by Somali immigrants. These discoveries have exposed Minnesota Democrat officials, who have (at the least) looked the other way as this fraud was ongoing and escalating.
Minnesota isn’t the only state where we are seeing this rampant misuse of hard-earned taxpayer dollars.
Over the past three years, Arizona has been governed by a Democrat Governor and Attorney General, Katie Hobbs and Kris Mayes. These two have combined to cultivate a culture of corruption in the Grand Canyon State that rivals the illegal shenanigans from Minnesota. There have been several instances of this abuse and chicanery from the Governor’s Office that the Attorney General’s Office has clearly provided cover for during this term in office.
Whether in Minnesota or Arizona or any other state or jurisdiction across the country, American taxpayers deserve honest, transparent public servants, who are committed to putting the interests of citizens above the political elite. Thankfully, for the people of Arizona, the Republican-led state legislature has worked to hold these lawless Democrats accountable to the rule of law, though Hobbs and Mayes continue to stonewall our efforts and perpetrate new avenues of corruption.
Inaugural Fund
Fresh off taking the oath of office, Hobbs proved herself unable to provide complete transparency to citizens with her inaugural fund. Arizona Governors have historically raised money to cover the expenses of their inaugurations, then transferred the excess funds to the state. However, Hobbs was reticent to share certain information of her donors and then withheld more than one million dollars from the state, forcing a clash with the legislature. This breakdown in transparency from the Governor’s Office led to legislation that codified the precedent predating Hobbs into law to mandate reporting of all future inauguration expenses and funds raised. The bill’s passage was overwhelmingly bipartisan – a rare feat in Arizona’s divided government, proving that Democrats understood the mess Hobbs had created for herself.
Hobbs Pay to Play
Likely the most egregious action of Hobbs’ administration to-date, the alleged pay-to-play scandal will define the culture of corruption surrounding her administration. Almost two years ago, The Arizona Republic reported that a for-profit, state-contracted group home operator, Sunshine Residential Homes, received a significant rate increase approval from the Hobbs-led Department of Child Services (DCS). Leading up to this rate increase, the group donated to Hobbs’ inaugural fund – after its request for a rate increase had been denied by the outgoing Republican administration. The reporting showed that Hobbs had not approved rate increases to any other group homes, nor were the rate averages for these group homes comparable with Sunshine Residential Homes. Additionally, DCS ended state contracts with 16 group homes, making the arrangement with Sunshine all the more suspicious.
Attorney General Kris Mayes did go through the motions of announcing an investigation into this alleged pay-to-play, but she attempted to order Maricopa County Attorney Rachel Mitchell and the Arizona Auditor General off the case – despite those offices being asked to investigate the uncovered scheme by state legislators. Mayes was soundly rebuked by Arizona Treasurer Kimberly Yee, who also requested that the Maricopa County and State Auditor General investigations continue. The Democrat Attorney General was also accused of a conflict of interest in that she was again shielding her same-party official from the full weight of accountability under the law. There have been no updates from Mayes’ office into the status of this investigation in almost two years, leading credence to the idea that this was a cover-up meant to protect Hobbs and her administration. Compounding the shady behavior from her administration, Hobbs vetoed a bill during last year’s legislative session meant to fool-proof future executives from exploiting any perceived loopholes to perpetuate this kind of abuse.
SNAP
The Supplemental Nutrition Assistance Program (SNAP) program doles out almost $100 billion annually to Americans to purchase food. However, like many government programs, this one is rife with fraud and theft. According to the U.S. Government Accountability Office, there were over $320 million in stolen benefits between October 2022 and December 2024. Additionally, the U.S. Department of Agriculture reported in 2023 (during the Biden administration) that approximately twelve percent of these benefits were fraudulent. The politics and policies of this bloated program aside, it is undeniable that SNAP needs more oversight and guardrails to ensure that taxpayer dollars are being stewarded appropriately.
Hobbs and Mayes disagree. Mayes sued the Trump administration over its commonsense efforts to request more information from states on SNAP beneficiaries. Hobbs, for her part, refused to acquiesce to the administration’s data requests. These two are politicizing an issue that should enjoy consensus across party lines. No government official should be standing in the way of efforts to root out fraud in any public program, where taxpayer dollars are at risk for abuse. Every taxpayer dollar should be protected to the highest level. Unfortunately, for Arizona, Katie Hobbs and Kris Mayes don’t want the federal government – and the taxpayer – to find out exactly how much fraud is in our state; and that’s a shame.
Mayes Pay to Play
U.S. Congressman Abraham Hamadeh has asked the U.S. Department of Justice to investigate an alleged pay-to-play bribery scheme involving Kris Mayes and outside political organizations. The allegations claim Mayes received political benefits in exchange for official actions targeting political opponents.
Shady Operator
Late last year, a top official in Mayes’ State Government Division was arrested for “controlling and trafficking stolen property.” Mayes’ office had been warned by the City of Peoria nearly two years earlier about serious allegations against this official – including fraud, conversion, and breach of fiduciary duty – yet Mayes kept her in a position of authority leading up to her arrest.
Arizona has long been known for its rugged independence and spirit of doing the right thing. Unfortunately for our state and its proud history, that reputation is being shattered by the culture of corruption from Hobbs and Mayes. Democrats across the country – from Arizona to Minnesota – have proven themselves incapable of governing our states – the laboratories of democracy – as the people rightly expect and deserve. It will be up to the voters to course correct this November and usher in legislators and executives who can – and will – steward the peoples’ money as it was intended.
Warren Petersen is the President of the Arizona State Senate and represents Legislative District 14.
by Jonathan Eberle | Nov 18, 2025 | News
By Jonathan Eberle |
Arizona House Speaker Steve Montenegro has formed a new advisory team to investigate allegations that Governor Katie Hobbs’ administration awarded a lucrative contract increase to a politically connected group home provider, raising fresh questions about influence and accountability inside the Department of Child Safety (DCS).
The move follows reporting by The Arizona Republic that Sunshine Residential Homes received a 30% rate increase after contributing more than $400,000 to Hobbs and Democratic political committees. According to documents cited in the reporting, other group home providers seeking similar adjustments were denied. Internal communications reportedly show DCS staff discussing the provider’s political connections to the governor and suggesting the increase be kept quiet from competing organizations.
The revelations come as DCS faces a budget shortfall and has been under pressure to reduce reliance on group home placements, making the agency’s decision to grant a significant rate hike particularly notable. Speaker Montenegro said the advisory team will conduct a legislative investigation to assemble facts, coordinate with law-enforcement agencies, and evaluate possible actions the House may take to prevent preferential treatment in state contracting.
“The facts reported raise serious questions the House cannot ignore,” Montenegro said in a statement. “Arizona’s children, families, and taxpayers deserve a system that is clean, fair, and focused on care, not political access or donations.”
The speaker also directed state agencies and contractors to preserve all relevant records and to cooperate fully with the Legislature. The advisory panel includes several senior lawmakers including Rep. Selina Bliss, Chair of the House Health and Human Services Committee; Rep. David Livingston, Chair of House Appropriations; Rep. Matt Gress, Chair of the Joint Legislative Audit Committee; Rep. Quang Nguyen, Chair of House Judiciary; and Speaker Pro Tempore Neal Carter.
The investigation builds on earlier legislative efforts to probe the relationship between Sunshine Residential Homes and the Hobbs administration. In 2024, Rep. Matt Gress requested investigations by the Maricopa County Attorney and the Auditor General following the first reports linking the provider to political contributions and favorable treatment. Rep. David Livingston separately urged Attorney General Kris Mayes to recuse herself, citing concerns about conflicts of interest involving the governor and the Democratic Party.
The House advisory team is expected to begin its work immediately and will coordinate with any parallel investigations by the Auditor General, the Maricopa County Attorney’s Office, or the Attorney General. Montenegro said lawmakers will “secure the records, ask the hard questions, and, if necessary, change the law to ensure it never happens again.”
Jonathan Eberle is a reporter for AZ Free News. You can send him news tips using this link.
by Jonathan Eberle | Nov 17, 2025 | News
By Jonathan Eberle |
Newly surfaced documents and internal communications are raising new questions about political influence inside the Arizona Department of Child Safety (DCS), prompting calls for accountability from legislative leaders. Senate President Pro Tempore T.J. Shope is urging state and county prosecutors to provide an immediate update on whether investigations into the matter remain active.
The controversy centers on Sunshine Residential Homes, a group home provider that recently received a 30% rate increase from DCS. The company has been a significant donor to Governor Katie Hobbs and multiple Democratic political groups—connections that agency employees reportedly flagged as a source of concern.
According to internal messages and financial records reviewed by lawmakers, DCS staff expressed discomfort with the approval process for the rate hike. Employees referenced Sunshine Residential’s political ties to the Governor and suggested the situation placed agency leaders in an “uncomfortable position,” particularly after the provider allegedly pressured the state by threatening to shift services to the federal system unless the increase was approved.
Despite warnings that the higher rate would deepen an already-projected $13 million budget shortfall, DCS moved forward with the decision. Documents also show Sunshine Residential cited a substantial financial deficit to justify its request. However, financial records reportedly indicate the provider had $440,000 in operating income—figures that independent accounting experts said appeared inconsistent with the claimed shortfall.
These discrepancies have intensified questions about whether political considerations influenced decisions affecting vulnerable children in state care. In a letter sent Thursday to Attorney General Kris Mayes and Maricopa County Attorney Rachel Mitchell, Shope requested confirmation that any investigations into the potential “pay-to-play” conduct are ongoing. He also asked prosecutors to update the Legislature on the status of their reviews.
“These revelations are deeply disturbing,” Shope said. “If a provider donating hundreds of thousands of dollars to the Governor then pressures the state for a massive rate increase—and receives it—Arizonans deserve to know whether political influence played a role.”
Shope emphasized that the issue extends beyond partisan lines. “This is not a partisan issue—it’s a public trust issue,” he said. “If political donations influenced decisions inside DCS, especially decisions involving vulnerable children, that is unacceptable. We intend to get to the bottom of this.”
Jonathan Eberle is a reporter for AZ Free News. You can send him news tips using this link.
by Staff Reporter | May 17, 2025 | News
By Staff Reporter |
Governor Katie Hobbs has another secretive fund, this one used to cover legal expenses.
Hobbs has never disclosed the existence of this fund, which covered the costs of a lawsuit filed against her by former gubernatorial candidate Kari Lake. AZ Capitol Times uncovered and first reported on its existence after discovering a financial report from the parent company of the state’s electric utility giant, Arizona Public Service (APS), disclosing a gift of $100,000 in 2024 to cover Hobbs’ legal expenses.
State law enables Hobbs to maintain this secretive fund; it has for nearly a decade.
APS parent company, Pinnacle West Capital Corporation (PWCC), also gave to Hobbs’ other secretive fund for her inauguration.
Although Hobbs’ legal fund was discovered, the governor says she won’t be publicizing any other details about the donors or total amount collected.
Hobbs also attempted to keep her inaugural fund secret, but relented to public disclosure after receiving threats of litigation. Records revealed that Hobbs’ inaugural fund collected nearly $2 million, but the event cost less than $210,000. Government transparency watchdogs attempted to determine whether Hobbs’ inauguration team continued to collect donations in excess of a pre-event budget, to no avail.
PWCC’s singular donation of $250,000 to the fund covered the inauguration in its entirety — but Hobbs pocketed the excess of well over a million for her reelection bid next year. Other large donors to that fund issued $100,000 each: Blue Cross Blue Shield, the National Association of Realtors, and Sunshine Residential Homes.
That last major donor, Sunshine Residential Homes, received millions in contracts from the Arizona Department of Child Safety (DCS) after making around half a million in campaign donations to Hobbs and the Arizona Democratic Party — despite DCS denying pay increases to home operators and dropping 16 providers during the contract renewal process.
Michael Beyer, the newly named communications director for Hobbs’ reelection campaign, defended the legal fund and its secrecy in a statement to the AZ Capitol Times.
“Kari Lake baselessly challenged the results of a free and fair election she lost,” said Beyer. “We won eight times in court, and yet Lake fought the results all the way through November 2024 when she finally lost her last appeal to the Arizona Supreme Court.”
Beyer recently joined the Hobbs campaign following his stint as the communications director for Virginia Senator Tim Kaine’s re-election campaign. Beyer’s past communications work includes the campaign for Mississippi’s 2023 Democratic gubernatorial candidate Brandon Presley, the Ohio Democratic Party, New Hampshire Democratic Party, and the Democratic Governors Association.
Some question whether the funds are another example of alleged “pay-to-play” occurring within the governor’s office. Hobbs approved legislation permitting public power entities like APS to engage in securitization. APS wrote the legislation.
Hobbs issued a defense of her passage of the bill, saying it would lower energy costs and improve grid resiliency.
“By working with bipartisan legislators I put in safeguards to ensure everyday Arizonans, not utilities, will benefit from securitization. And I made sure this bill will provide a tool to grow our energy economy,” said Hobbs. “Because of this bill, Arizona families will save money and we will help create more jobs in a clean energy economy that, in just the last few years, has brought nearly $18 billion in investments to our state and created over 18,000 quality jobs.”
Hobbs also vetoed legislation from Senate President TJ Shope requiring companies seeking state contracts to list all donations given in the past five years to the governor.
AZ Free News is your #1 source for Arizona news and politics. You can send us news tips using this link.
