A two-year investigation into allegations surrounding Gov. Katie Hobbs and a state contractor has ended without criminal charges. The Arizona Attorney General’s Office said Friday it found no evidence establishing a bribery case or other related crimes.
The investigation centered on Sunshine Residential Homes, which received a 30% rate increase from the Department of Child Safety after the company and its affiliates gave roughly $400,000 to Hobbs’ inauguration committee and the Arizona Democratic Party. Hobbs has denied influencing the rate decision, and the former DCS director who approved it has also said the governor’s office did not pressure him.
Investigators reviewed campaign-finance and procurement records, bank documents, state communications and more than 100,000 documents as part of the inquiry. They concluded there was no evidence of the required exchange of favors to support a bribery charge.
The matter could remain technically open so the Attorney General’s Office can assist with a separate investigation by the Arizona Auditor General. The controversy has also remained a political issue during the 2026 governor’s race, where Republican candidate Andy Biggs has continued to criticize Hobbs over the allegations.
