Group dwelling received large after donating to Arizona Gov. Katie Hobbs

LOS GATOS NEWS AND EVENTSJune 5, 2024

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Group dwelling received large after donating to Arizona Gov. Katie Hobbs

Arizona is putting fewer children in group homes these days, so it was no surprise in February 2023 when the Department of Child Safety denied a 20% rate increase to the state’s largest group home business.

Three days later, Sunshine Residential Homes donated $100,000 to Gov. Katie Hobbs’ “dark money” operation — the one she set up under the guise of paying for her inauguration festivities.

Three months later, Sunshine got a 30% rate increase.

And this year, it got another 20% boost along with approval for more beds, further boosting company profits.

Clearly, it pays to toss money Gov. Hobbs’ way.

And clearly, someone — Attorney General Kris Mayes? the Legislature? — should look into what appears to be a clear case of pay to play.

Sunshine didn’t get a raise. Then it donated

For nearly 18 months, The Arizona Republic’s Stacy Barchenger has dogged the story of Hobbs’ inaugural fund, which raised multitudes more money than needed to pay for her festivities upon becoming governor in January 2023.

Hobbs shook down insurance companies, labor unions, homebuilders, lobbying firms and regulated utilities, seeking donations of up to $250,000 apiece.

And Sunshine Residential Group Homes, a for-profit business that is funded entirely from state contracts.

Barchenger reports that DCS has been regularly denying pay increases to group home operators, citing both budgetary constraints and a desire to get kids out of group homes.

So, it wasn’t a surprise in February 2023 that the state rejected Sunshine’s request for a 20% pay raise, from a daily rate of $149 per child to $175.

Three days later, on Feb. 9, 2023, Sunshine kicked in $100,000 to Hobbs’ inauguration fund.

DCS, Hobbs says this wasn’t about the cash

It was the second largest donation to Hobbs’ inaugural fund, second only to Arizona Public Service, the powerhouse utility that doles out donations to politicians like candy.

Never mind that the inauguration had already happened fully a month before Sunshine’s donation. Or that Hobbs already had collected $1.9 million for an event that cost $207,000 to put on.

Never mind, too, that just three months later, in May 2023, Sunshine would renew its plea for more state cash, claiming that it was $4.5 million in the red.

Fortunately, that $100,000 donation — along with another $100,000 given to the state Democratic Party, to go along with $200,000 the previous fall while Hobbs was running for governor — paid off.

Naturally, both DCS and Hobbs’ office say the governor had nothing to do with Sunshine’s sudden 30% pay hike, to $195 a day per child.

A DCS spokesman told Barchenger the department simply changed its mind about boosting Sunshine’s pay out of a fear that the company would use its beds for federal refugees rather than kids in state custody.

Sunshine gets more per child than others

Hobbs’ spokesman, Christian Slater, meanwhile, dodged Barchenger’s questions about the propriety of a governor slurping up money from a business funded entirely by state taxpayers.

A business, by the way, that got yet another rate hike effective June 1 — a 20% boost that allows Sunshine Residential Homes to charge more for its standard group home services than any other company.

Sunshine now pulls in $234 a day per child from DCS, compared to the $169 average rate paid to group homes. And Sunshine was approved this year for 300 beds, up from 291.

Hobbs promised transparency:She’s not offering it

Not bad for a company that scored average in an evaluation by DCS when scoring contract proposals from group home operators.

Barchenger reports it’s unclear how Sunshine — which has had state contracts since 2011 but never made a political contribution until last year — justified its latest rate hike.