State Rep: $350 Million Disappeared from Arizona’s Budget under Gov. Katie Hobbs’ Watch
A Republican state representative is demanding answers after hundreds of millions of taxpayer dollars disappeared into thin air.
State Rep. Alexander Kolodin (R-Fountain Hills) sent an open letter to Gov. Katie Hobbs (D) on January 20, demanding answers for $339 million that allegedly disappeared from the state’s budget. He questioned why the governor’s budget director appears to be taking the fall for it.
The letter notes that Hobbs’ liaisons informed the legislature that several insolvent agencies require the bailout before the end of the current fiscal year. But they did not provide any detail on how the state got into this position.
“In just two weeks’ time,” Kolodin writes, “I’ve learned that the problem has worsened and that your office’s request is now $350 million!”
$339m disappeared from Arizona's budget and I have questions for Katie Hobbs! pic.twitter.com/1xTJHUrwcA
— Rep. Alexander Kolodin (@realAlexKolodin) January 30, 2025
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Where Did the Money Go?
Kolodin cites the Department of Developmental Disabilities, which now falls short an additional $12 million, for the discrepancy. “Your office’s presentation to the Legislature stated that this critical program may run out of money in April or May," he wrote. " Which is it?”
He identifies a COVID-era program Hobbs continued that she allegedly failed to alert legislators to allocate funding for when they were crafting their 2024 budget.
Kolodin points the finger at the state’s liabilities in the Qasimyar litigation, which amount to around $60 million—for which Hobbs also allegedly did not budget.
Qasimyar v. Maricopa County was a class action lawsuit against Maricopa County for overtaxing some property owners from 2015 through 2021. The Arizona Court of Appeals upheld a ruling siding with the property owners, forcing the Maricopa County Treasurer’s Office to pay back over $329 million.
Kolodin raised questions about the sudden resignation of Hobbs’ budget January 29: “Why has your budget director taken the fall? . . . What are the circumstances surrounding her resignation?”
The missing $350 million Kolodin cites represents a significant amount for Arizona taxpayers who will want to know if it came through mismanagement or corruption.
Kolodin suggests the latter, asking Hobbs in his letter, “Who in your orbit is profiting off of Arizona’s children?” This is no mere idle speculation.
According to the letter, the Department of Child Safety (DCS) awarded higher rates to a vendor with connections to the governor’s office, resulting in DCS’s congregate care program running out of funds.
Arizona Attorney General Kris Mayes has already launched a criminal investigation into Hobbs for unrelated bribery and fraud allegations surrounding the governor’s 2023 inauguration. It seems her problems have begun to grow.
Hobbs solicited donations of up to $250,000 per donor for her inauguration through a “dark money” group. Sunshine Residential Homes’ CEO was on the inaugural committee, and his company made a $100,000 donation, making it the second largest inaugural donor after the state’s largest power company. The company and its CEO also contributed over $300,000 to the Arizona Democratic Party and Hobbs directly since 2022. Hobbs raked in nearly $1.5 million from special interests, although the inauguration only cost around $200,000.
Three months after the inauguration, Sunshine received approval from DCS to raise its rate for daily childcare by nearly 60 percent. Interestingly, DCS denied Sunshine Residential a rate increase before Sunshine made the donation.
Growing Distrust of the Hobbs Administration
“Arizonans deserve answers to my questions,” Kolodin wrote. “I also request a full accounting for the programs that are apparently broke.” As yet, the office of the governor has not responded.
(READ MORE: Leftist Arizona Governor Blocks Second Amendment, Fights Against Campus Carry Legislation)
