Governor Hobbs Unveils Ethics Reform Package in Arizona as Republicans Call It ‘Smoke and Mirrors’

Arizona Governor Katie Hobbs (D) announced Tuesday a sweeping ethics and transparency reform proposal she described as the largest in modern state history, calling on the Republican-led Legislature to pass it immediately to “tackle corruption head-on.”

The three-pillar package, released amid ongoing investigations into her administration’s contracting practices, includes:

• Public Transparency and Disclosure Database: A searchable, publicly accessible database of all state contractors that would require disclosure of every individual or entity owning 5% or more of the business, along with standardized reporting of public spending and permanent ownership records.  
• Independent and Fair Contracting Reforms: A prohibition on state contractors or their owners making campaign contributions of more than $50 to candidates, political committees, or PACs between the time a bid is submitted and a contract is awarded. Violations would make the contractor ineligible for future state contracts for up to three years and subject to civil penalties.  
• Comprehensive Lobbyist Gift Ban: An outright prohibition on lobbyists paying for food, beverages, speaking engagements, travel, lodging, or flowers for legislators, statewide officials, and state employees — moving beyond current disclosure requirements that saw nearly $2 million in lobbyist expenditures reported in 2022 alone.

“Arizonans deserve complete confidence that their government is working for them — not for lobbyists or special interests,” Hobbs said in a statement. “This is one of the most comprehensive transparency and ethics reform efforts our state has seen in decades. I call on the Legislature to put aside partisanship and pass these reforms immediately so we can protect taxpayer dollars, improve transparency, and tackle corruption head-on.”

Arizonans deserve a government that works for them—not special interests. Today I unveiled the largest ethics reform package in modern AZ history: a public transparency database, fair contracting reforms, and a comprehensive lobbyist gift ban. pic.twitter.com/XTVJ9hmNhz

— Governor Katie Hobbs (@GovernorHobbs) February 17, 2026

The proposal would apply to legislative and statewide officials, their campaigns, and affiliated political committees. Hobbs framed the reforms as modeled after stronger standards in states like Florida and Missouri.

The timing of the announcement has drawn sharp scrutiny. It follows months of our reporting, and multiple investigations, into allegations that a major Hobbs donor, Sunshine Residential Homes — which operates group homes for children in the state’s foster care system — received a favorable $4 million annual rate increase from the Department of Child Safety shortly after making large political contributions to Hobbs and Democratic causes.

Hobbs has denied any wrongdoing, but the matter has triggered probes by the Arizona House, Senate, and other oversight bodies.

Arizona Republicans quickly dismissed the package as insufficient and politically motivated.

Sen. TJ Shope (R-Coolidge), who has led GOP efforts on contracting transparency, called the proposal “not serious” and a “smoke and mirrors game” designed to divert attention from the scandals. He criticized what he described as massive loopholes, “the loopholes are there to drive a Mack truck through”— including the failure to address contributions funneled through political parties — and said the contribution ban raises First Amendment concerns. 

Shope plans to advance his own Senate Bill 1186, which would require broader disclosure of financial support to the governor’s campaign or aligned groups during the bidding process.

Senate President Warren Petersen (R-Gilbert) acknowledged the proposals could serve as a starting point “if there is political will,” but noted the late-session timing appeared strategic.

Other GOP lawmakers have echoed long-standing criticism that Hobbs’ administration has stonewalled transparency requests, including on border-related expenditures and contracting decisions. Republicans have indicated they will continue pushing their own transparency bills as the session moves forward.