Governor Katie Hobbs is under fired once again and demands are increasing that her Arizona Department of Housing (ADOH) Director nominee, Joan Serviss, resign amid serious findings of waste, fraud, and abuse of taxpayer dollars by the Arizona Auditor General.
An Arizona Auditor General report details disturbing levels of incompetence including one instance in which the Department wired $2 million in State Housing Trust Fund monies to fraudsters impersonating officers from a title company and nonprofit housing organization in June of 2023 and did not realize the fraud occurred until six months later.
The Auditor General concluded ADOH failed to develop and implement wire transfer policies to prevent and detect fraud, waste, and abuse. While ADOH committed nearly $1.26 billion toward affordable housing issues in fiscal year 2023, the agency doesn’t have a comprehensive process to evaluate program performance, limiting its ability to ensure its programs are effectively addressing the state’s housing problems.
A review of a dozen housing projects paid for with grants from ADOH showed failures to address health and safety issues, including a rodent infestation; misuse of grant monies; and a lack of documentation demonstrating residents received supportive services to help them live independently.
In September of 2023, the Senate Committee on Director Nominations (DINO) found Serviss was unfit to serve as Director of ADOH after a troubling history of pervasive plagiarism was alleged while she served as Executive Director of the Arizona Housing Coalition. As a result, the committee recommended the Senate reject her confirmation.
Following the recommendation, Hobbs was accused of attempting to evade the confirmation process and withdrew all nominees.
The Senate sued, and Hobbs was found to have broken the law.
The Senate announced it was taking action now that the Governor renominated Serviss. Serviss’ Director nomination is currently scheduled for a Senate vote next week.
“Disturbing fraud, waste, and abuse have occurred under her watch. State lawmakers and citizens who rely on this agency are outraged. The Senate cannot in good conscience confirm this Director,” said Senate President Warren Petersen. “We are calling on her to do the right thing by stepping down immediately before the vote occurs. We are also asking the Governor to promptly send us a highly competent and qualified nominee to replace her. Arizonans deserve better.”
“This just another example of failure and scandal from the Hobbs Administration. Arizona cannot afford to have unqualified individuals running our critical state agencies, especially one that’s tasked with helping Arizonans facing homelessness obtain safe and secure housing,” said President Pro Tempore T.J. Shope. “Serviss should have been immediately withdrawn from consideration after DINO determined she was unfit to serve in this role.”
“Senate Republicans are committed to protecting taxpayer dollars, and unfortunately, Serviss falls short with supporting this important mission,” said Majority Whip Frank Carroll. “While the Trump Administration roots out fraud, waste, and abuse at the federal level, the Republican-led legislature will do everything in our power to ensure federal dollars sent to our state are managed in the most effective and responsible way.”