'Issue of transparency': Arizona Coyotes' land interest raises ethics flags for Gov. Katie Hobbs

About three weeks after voters rejected the Arizona Coyotes’ plans to build a hockey arena and entertainment district in Tempe, the team CEO had a meeting with Gov. Katie Hobbs, according to a copy of Hobbs’ schedule.

That June meeting came weeks before an application was filed to buy trust land from the Arizona State Land Department under Hobbs’ oversight.

Two months later, schedules show team CEO Xavier Gutierrez had another meeting in the Governor’s Office. That time, Gutierrez was to meet with Hobbs’ Chief of Staff Chad Campbell, a former lobbyist for the Coyotes and whose political consulting firm worked on the team’s Tempe campaign before Campbell joined the Hobbs administration.

The Governor’s Office would not say what was discussed in those meetings, including whether the Coyotes’ effort to buy state land was on the agenda. Gutierrez also declined to reveal what was discussed, saying whether to do so was up to the Governor’s Office.

Two government ethics experts said Campbell’s discussion with the CEO, a former client, appeared to be a conflict of interest and they called for more transparency.

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“He should stay out of this entirely,” said Richard Painter, a professor at the University of Minnesota Law School, a former White House ethics lawyer and co-author of an ethics guide for public employees that was accepted for publication last year by the American Law Institute legal research organization.

“That is just one of those fundamental principles that you can’t go into government and then help your former employer,” Painter said.

Campbell’s schedule, obtained by a request under Arizona Public Records Law, shows an August meeting with Gutierrez, as well as calls that month to a “Xavier" and another about “State Trust Land proposed use at Scottsdale Rd & 101,” the area scouted by the Coyotes. The schedule does not say who else was involved in the second call.

Hobbs’ spokesperson Christian Slater said there was a single discussion between Gutierrez and Campbell but it was rescheduled, making it appear as if there were multiple meetings. Slater could not say when that one meeting was.

Slater said the governor and Campbell have "a lot of different meetings on a number of different topics. But again, we’re not going to get into ... private discussions and conversations that they have.”

Slater did not respond to a question about the appearance of a conflict but said in an email that Campbell “has no involvement in the pending application for a potential land sale.”

The Arizona Republic regularly requests Hobbs’ and Campbell’s schedules, which are subject to disclosure under public record law. When requests dating back to April had not prompted a response, The Republic in December sent a legal demand for those records. The Governor’s Office promptly complied and provided Hobbs’ and Campbell’s calendars through Nov. 30.

Hobbs told The Republic in December that it was too early to comment on the possibility of the Coyotes buying state land.

"As with any state land purchase, we're going to make sure that it's in the best interest of the beneficiaries,” she said.

“If this is happening, it will happen like any other state land purchase,” Hobbs said then. She said at the time that “as far as I know, [Campbell] hasn’t been involved.”

Millions of acres of land given to Arizona at statehood are held in a trust and can be leased or sold to the benefit of several programs, the largest beneficiary being K-12 education. The Arizona State Land Department oversees those leases and sales. Anyone can apply to buy state land which must be sold at public auction.

The Coyotes applied to buy land at the northwest corner of Loop 101 and Scottsdale Road in Phoenix, according to an application on file at the Arizona State Land Department, though Gutierrez said the team is still considering other land options elsewhere, too. The team is under deadline pressure to find a permanent home after voters rejected their plans in Tempe last year.

The application to buy 200 acres of state land was submitted in late June 2023 by the law firm Fennemore Craig, and was revised in January to reflect the applicant was the Coyotes and the acreage sought about 100 acres.

Campbell’s ties to the Coyotes

Campbell was a lobbyist for the Coyotes from Feb. 2021 to Jan. 2023, according to required filings with the Arizona Secretary of State’s Office.

His political consulting firm, Lumen Strategies, was one of multiple firms hired last year to work on the Coyotes’ proposal to build in Tempe. Lumen was paid $25,000 by Tempe Wins, a political action committee predominantly funded by Coyotes’ majority owner Alex Meruelo’s development company, Bluebird Development LLC, records show.

Tempe campaign finance records show payments to Lumen were made between mid-February and late June 2023. One $5,000 payment was recorded on June 22, just over two weeks after Campbell joined the Governor’s Office.

On June 2, three days before starting as Hobbs' chief of staff, Campbell signed a disclosure affirming he had no outside employment or ownership interest in any company with an interest in state business. At the time, the Governor’s Office said Campbell had “separated” from Lumen.

Though the payrolls overlap, Campbell’s former business partner said there was no overlap in work.

“Our work concluded when they lost the campaign,” said Stacy Pearson, who co-founded Lumen with Campbell.

Pearson attributed the late-June payment to the political action committee getting “caught up on their invoices.

“It had absolutely no overlap, none whatsoever, with his work at the Governor’s Office," Pearson said.

What ethics experts say

Two government ethics experts said Campbell should not have any contact with the Coyotes given his past representation of them. His role could prompt questions for the public about the influence of special interests, the experts, including Painter, said.

John Pelissero, senior scholar in government ethics at the Markkula Center for Applied Ethics at Santa Clara University, said owners of a sports franchise may have an interest in speaking to a governor about an expansion, but that Hobbs and her staff should be more transparent about their role.

“To me, it looks like the Chief of Staff has a conflict of interest here based upon at least the individual's former role as ... being a representative of the sports franchise,” Pelissero said.

“It's an issue of transparency for the governor,” he added. “They should be as transparent as possible with the public, with the media, about why they're having various kinds of meetings, communications, conversations, transactions with the Coyotes if it involves acquiring this land that they are interested in from the land trust."

Hobbs is not the first Arizona governor to face questions about the accessibility afforded to private interests or lobbyists. Former Gov. Doug Ducey, who served two terms before Hobbs took office, faced criticism that he and his staff played favorites with business, and often at taxpayer expense.

Before she was elected, Hobbs pledged to build the most ethical administration in state history. Some critics say she’s fallen short when it comes to transparency, and lawmakers passed a bill last year requiring more public reporting after scrutinizing the governor’s fundraising for her inauguration.

Reach reporter Stacey Barchenger at stacey.barchenger@arizonarepublic.com or 480-416-5669.

This article originally appeared on Arizona Republic: Hobbs' involvement in Arizona Coyotes' land interest faces ethics scrutiny