KTAR NEWS: Arizona House hires independent counsel to look into pay-for-play allegations against Gov. Hobbs

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PHOENIX — The Arizona House of Representatives announced Monday the hiring of an investigation counsel to review Gov. Katie Hobbs and her alleged “pay-for-play” scheme with Department of Child Services-contracted company, Sunshine Residential Homes.

House Speaker Steve Montenegro said in press release Justin Smith of Missouri’s James Otis Law Group will “review records, conduct interviews and report findings directly to the advisory team and House leadership,” who hired him for an impartial perspective in the probe.

“The advisory team has done serious, disciplined work, and their recommendation to bring in independent counsel is the right next step,” Montenegro said.

According to the release, Montenegro formed the current advisory team in 2025 to “consolidate” past efforts such as District 4 Rep. Matt Gress submitting a formal referral and District 28 Rep. David Livingston calling for Attorney General Kris Mayes “to recuse herself due to conflicts of interest.” Mayes had told other agencies to stand down as her office could handle the allegations against Hobbs.

Details on ‘pay-for-play’ probe involving Gov. Hobbs, Sunshine

The allegations stem from an Arizona Republic story published in June 2024 that claimed Hobbs was giving preferential treatment to Sunshine, a shelter for neglected and abused children. Sunshine made donations totaling $400,000 to Hobbs’ inauguration committee and the Arizona Democratic Party in 2022 and 2023, both before and after Hobbs was elected, the Republic reported.

As of when the allegations surfaced, Sunshine was the only group home operator to receive approval for a rate increase from DCS, and no other operator is paid as much per child, according to the state’s largest newspaper.

Hobbs, through a spokesman, denied wrongdoing after the report surfaced.

“Just like past investigations instigated by radical and partisan legislators, the administration will be cleared of wrongdoing,” Christian Slater, the governor’s communications director, said in a statement. “Gov. Hobbs is a social worker who has been a champion for Arizona families and kids. It is outrageous to suggest her administration would not do what’s right for children in foster care.”

Although there was nothing inappropriate about the donations, DCS had approved significant rate hikes requested by the group home operator since Hobbs took office in 2023, according to The Arizona Republic, raising questions about preferential treatment.