Another Hidden Fund Uncovered in Governor Hobbs’ Financial Files

By Staff Reporter |

Governor Katie Hobbs has established a secret fund specifically for covering her legal expenses, a fact that has not been publicly acknowledged until now.

AZ Capitol Times recently reported on the fund’s existence after discovering a financial report indicating a $100,000 donation from Pinnacle West Capital Corporation, the parent company of Arizona Public Service (APS), to cover Hobbs’ legal costs related to a lawsuit by former gubernatorial candidate Kari Lake.

This fund operates under state law, allowing Hobbs to keep it undisclosed for nearly a decade. However, the revelation raises questions about transparency in the governor’s finances.

In addition, APS has contributed to Hobbs’ inaugural fund, which was also kept under wraps until legal threats prompted eventual disclosure.

Records show that Hobbs’ inaugural fund amassed nearly $2 million, significantly exceeding the event’s costs of around $210,000. Despite inquiries from transparency watchdogs, clarifications regarding excess donations remain elusive.

Pinnacle West’s sizable donation covered the entirety of the inaugural costs, enabling Hobbs to retain over a million dollars for her upcoming reelection campaign. Other substantial donors to this fund included Blue Cross Blue Shield, the National Association of Realtors, and Sunshine Residential Homes.

The latter, Sunshine Residential Homes, benefited from multimillion-dollar contracts with the Arizona Department of Child Safety (DCS) following considerable campaign contributions made to Hobbs and the Arizona Democratic Party, despite DCS’s refusal to increase payments to home operators.

Michael Beyer, recently appointed communications director for Hobbs’ reelection campaign, defended the legal fund’s lack of transparency. He criticized Lake’s legal challenges, stating, “We won eight times in court, and yet Lake fought the results all the way through November 2024.”

Beyer’s background includes communication roles for various Democratic campaigns, providing robust experience for his current position.

Concerns linger regarding potential “pay-to-play” dynamics associated with Hobbs’ administration. Her support for legislation enabling public power companies like APS to engage in securitization has drawn scrutiny, particularly since APS authored the legislation.

Hobbs responded to these concerns, claiming the bill would lower energy costs and enhance grid resilience. “By working with bipartisan legislators, I included safeguards to ensure that Arizona families, not utilities, reap the benefits of securitization,” she stated.

Additionally, Hobbs vetoed a proposal from Senate President TJ Shope that would have required companies bidding for state contracts to disclose all donations made to her in the previous five years.