Arizona Governor Katie Hobbs (D) is under investigation for a potential pay-for-play scheme involving a group home business that cares for foster children. The residential home, Sunshine Residential Homes, donated $400,000 to Hobbs’ campaign and inauguration and the Arizona State Democratic Party. The governor’s Arizona Department of Child Safety (DCS) also approved a rate hike of nearly 60% for the residential home.

The investigation, launched by Attorney General Kris Mayes’ office, followed a publication by The Arizona Republic that pointed out the circumstances surrounding the approval. The publication reported that Sunshine Residential Homes received the highest rate increase among all group home providers in the state.

The publication pointed out that, since July 2022, group home providers have asked the DCS countless times to increase the rate for a standard bed. As a result, Ohana Homes received a rate increase to $155/day in September 2022, but their contract wasn’t renewed in 2023. On the other hand, Sunshine Residential Homes requested a 20% increase to $179/day in December 2022 but was denied on Feb. 6, 2023.

Meanwhile, Sunshine Residential Homes donated $100,000 to Hibbs’ inaugural campaign, and in May 2023, the residential home received a rate increase to $234/day, higher than the average $169/day for other group homes.

Sen. T.J. Shope (R-AZ) requested the investigation, citing misconduct. According to the New York Post, Shope sent a letter to Attorney Mayes and Maricopa County Attorney Rachel Mitchell saying that the situation can only be described as a pay-to-play scheme involving the residential home, DCS and Hobbs’ office.

“We were talking about millions of dollars, and to know that not many, if any at all, have seen rate increases that large, it was definitely troubling,” Shope said. “I have to believe that they, at the very least, see the allegations the same way I do, which is troubling at best and possibly worse.”

However, Hobbs’ office issued a statement denying any wrongdoing, stating that the governor’s office played no role in the DCS decision.

“Governor 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,” the statement reads.