Arizona Democrat Attorney General Kris Mayes has opened an investigation against Democrat Gov. Katie Hobbs.

The governor faces allegations in what a state senator called a ‘pay-to-play scheme’ involving “the Department of Child Safety and a group home company that received a substantial rate increase,” Axios noted.

“Today’s article on @azcentral by @sbarchenger brings many legal questions that are both criminal and civil in nature. I call for @AZAGMayes and/or Maricopa County Attorney @Rachel1Mitchell to investigate this matter. We must find the truth of what @GovernorHobbs knew and at what time she knew, as well as what she directed based on that knowledge,” state Senator T.J. Shope, a Republican, said Wednesday.

“In his request, Shope named specific crimes, including bribery, fraud and contract law violations, that he believed could be implicated,” The Arizona Republic noted.


“Thank you for your referral dated June 5, 2024, regarding Sunshine Residential Homes. The Criminal Division of the Attorney General’s Office is statutorily authorized to investigate the allegations and offenses outlined in your letter. To that end, the Attorney General’s Office will be opening an investigation,” Nick Klingerman, Chief Counsel Criminal Division, wrote to Shope.


The Arizona Republic reports:

A spokesperson for Hobbs — who often notes she is a former social worker — said it was “outrageous to suggest her administration would not do what’s right for children in foster care.”

“Just like past investigations instigated by radical and partisan legislators, the administration will be cleared of wrongdoing,” spokesperson Christian Slater said in a text message.

A spokesperson for Sunshine Residential Homes said the company “continues to remain committed in caring for the population they have served for several decades in Arizona — troubled and vulnerable youth receiving the resources necessary to thrive.

“We have always been steadfast in our commitment and partnership to the State of Arizona and remain committed to do so going forward while cooperating fully with any inquiry,” reads the statement from Tommy McKone, owner of McKone Strategies in Phoenix. McKone said he was “engaged” by the company “over the last week to help streamline communications and public relations.”

Per Axios:

The Arizona Republic reported Wednesday that Sunshine Residential Homes received a large rate hike from DCS after making six-figure contributions to Hobbs’ inauguration fund and the Arizona Democratic Party.

Sunshine applied for a rate hike in December 2022 that DCS denied in February 2023. It again applied for a rate increase in May 2023 that was approved.

Meanwhile, the company gave $100,000 to Hobbs’ inaugural fund in December 2022, though the inaugural fund’s records dated the contribution in February 2023. Sunshine also gave $200,000 to the Arizona Democratic Party shortly before the 2022 election.

Sunshine CEO Simon Kottoor was on Hobbs’ inaugural committee and contributed to her campaign, and his company gave her an award about a month before her election.

“The investigation will determine whether Hobbs’ administration violated the law when it gave pay increases to a state contractor and Hobbs political donor,” Toria Brooke wrote.

“The Arizona Republic reported that the Department of Child Services gave a nearly 60% pay rate increase to Sunshine Residential Homes, a group home provider for foster children, as the department has reduced its reliance on group homes overall. The company’s current $234 daily rate is the highest of any group home contractor and well above the $169 average daily rate paid by DCS under its current contracts,” Brooke said.

“The Republic also found that pay bump came as the company donated hundreds of thousands of dollars to the state Democratic Party and a dark money group affiliated with Hobbs. Sunshine Residential’s CEO, Simon Kottoor, also made a personal contribution to the Hobbs’ gubernatorial campaign in 2022,” she added.

The Arizona Republic added:

Sunshine Residential Homes also launched a political spending campaign, donating $400,000 in 2022 and 2023. Of that, $300,000 was donated to the Arizona Democratic Party in the course of three transactions that occurred before and after Hobbs’ election, state campaign finance records show.

The company also cut a $100,000 check to Hobbs’ inauguration fund, records previously provided by the fund show.

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