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Bipartisan Arizona budget cuts oversight program prompted by Hacienda HealthCare sex abuse scandal

White sign with Hacienda HealthCare and its logo in light blue and dark purple
Sky Schaudt
/
KJZZ
Hacienda HealthCare in south Phoenix.

Arizona officials cut funding for a program that provides independent oversight at group homes for people with developmental disabilities, which was created in response to a sex abuse scandal. Advocates say the decision will harm the most vulnerable Arizonans.

The Arizona Legislature approved a bipartisan state budget on Thursday night.

Legislative budget documents show that the $18.3 billion spending plan removes $1.2 million to fund a “group home monitoring pilot.”

What those documents don’t say is the program has actually been around for years.

The Legislature and former Republican Gov. Doug Ducey first created the Compliance, Oversight, Monitoring, and Investigations Team, or COMIT, program in 2022 after an incapacitated disabled resident at a Hacienda HealthCare facility in Phoenix was impregnated by a nurse who had raped her repeatedly.

In order to provide independent oversight of facilities like Hacienda, the state contracts with an outside nonprofit organization called Disability Rights Arizona.

J.J. Rico, the organization’s CEO, said Disability Rights Arizona monitors group homes with complex needs, which includes those with developmental disabilities and mental illness.

“The focus on that was because those are folks that are most at risk for abuse, neglect, harm, lack of services or support,” Rico said.

But Rico said his organization will no longer be able to provide that oversight after the budget — negotiated by Democratic Gov. Katie Hobbs and lawmakers from both parties — decided to zero out its budget for the upcoming year.

“The oversight won't happen by our office,” he said.

‘Penny wise, pound foolish’

The oversight funding in question would account for a tiny fraction of state spending. And advocates say that money would be well spent, citing the fallout from the Hacienda scandal.

“You paid for that with our money,” parent Amber Brown told lawmakers at a committee hearing on Wednesday. “Is the trade-off really worth it? Because right now you are making the same penny wise, pound foolish decision, and history will repeat itself.”

Brown pointed out that last year COMIT staff uncovered physical abuse, neglect and two deaths at group homes.

Sen. Tim Dunn (R-Yuma), who ran a bill to provide more permanent funding for group home oversight, called it “a very important program.”

The bill passed out of the Senate with only Republican votes in March.

At the time, Democrats who voted against the bill said they supported the oversight program but panned Dunn’s bill because it didn’t actually identify where ongoing funding would come from.

They said that was irresponsible as the state’s Division of Developmental Disabilities already faces increasing enrollment and costs and has faced budget crises in recent years.

“Oversight should be preserved, but it must be responsibly funded and sustained,” Sen. Rosanna Gabaldon (D-Green Valley) said.

What happened?

A man in a suit holds up a microphone in a wood-paneled room
Wayne Schutsky
/
KJZZ
Sen. Tim Dunn speaks at the Arizona Senate on Feb. 24, 2025.

Dunn said he fought for that sustainable funding but, ultimately, the program was a casualty of budget negotiations.

COMIT began as a three-year pilot program in 2022 before lawmakers voted to make it permanent last year.

But even though the program has been around for years, it was most recently funded using a “one-time” appropriation, meaning that funding was not factored into projections for future years.

Dunn said those types of one time appropriations are often at risk of being cut.

“There were a lot of different things that didn’t make the budget that were considered new money even though that’s been around for a while, and it’s a very important program,” he said.

Rico said he was “shocked, surprised,” when he found out the new budget did not include money for oversight, saying he had worked with lawmakers this year to secure funding.

“The message we received from both representatives, senators of both parties was, ‘we're working on it,’” he said. “And so, we kind of trusted in the process, tried to provide any information that was needed, offered multiple times to have meetings.”

Top budget negotiators from both parties won’t say why they couldn’t find that sustainable funding source for oversight during this year’s budget talks.

“So I don’t know if somebody overlooked it or what,” said Rep. David Livingston (R-Peoria), who chairs the House committee that oversees budget bills.

House Speaker Steve Montenegro (R-Goodyear) credited both Livingston and Rep. Matt Gress for playing key roles in negotiating the budget.

But Gress gave a similar answer, saying he did not know why the funding for the oversight was not included in the budget.

In a statement, Christian Slater, a spokesman for the Governor’s Office, praised the budget and pointed out other investments made in the state program that provides care for Arizonans with developmental disabilities.

“No party got everything that they wanted, but it’s a strong deal that will make Arizona stronger, safer and more prosperous,” he said.

But Slater did not say why money for independent oversight was left on the cutting room floor, why the governor’s office did not consider it a priority, or who, if anyone, was opposed to the funding.

“Gov. Hobbs has fought and secured critical funding for Arizonans with disabilities, including protecting the Department of Developmental Disabilities in the proposed budget, and will work with DES to ensure that the program has the necessary oversight in the coming years,” he said.

But Rico, who runs Disability Rights Arizona, did not mince words when asked about what happens next.

“The state should be doing it, but I'll just speak directly that the state, in our opinion, has not done an effective job,” he said. “We are starting to work well with the state to see some improvements both from our suggestions and recommendations, but there's still a long way to go.”

For his part, Dunn said he’s not done fighting for the program.

“And we've been working for years to get that program going, and we're going to, I'm going to continue to try to advocate for it again next year to try to come back,” he said.

More Arizona disability news

Wayne Schutsky is a senior field correspondent covering Arizona politics on KJZZ. He has over a decade of experience as a journalist reporting on local communities in Arizona and the state Capitol.