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AZ State treasurer excludes 2 Hobbs appointees from investment meeting, citing 'murky' status

Republican Treasurer Kimberly Yee jumped into the fray over how state agency directors should be appointed by refusing to acknowledge the authority of two top employees given new titles by Democratic Gov. Katie Hobbs.
Lawyers for the Treasurer's Office and outside counsel advised her that the legal status of the employees as agency bosses was now "murky," which led her to "not recognize" two of Hobbs' appointees as at a State Board of Investment meeting, Yee told The Arizona Republic Wednesday.
On Monday, Hobbs ditched the process used for decades in the Legislature to appoint the heads of state agencies subject to Senate confirmation, writing in a letter to state Senate President Warren Petersen that she was tired of the "political circus" that has led to stalled appointments.
She withdrew her remaining nominations from the Senate's Committee on Director Nominations and bestowed the new title of "executive deputy director" on 13 of her nominees, allowing them to skip Senate confirmations and continue their work as official agency directors.
Democratic state Attorney General Kris Mayes backed up Hobbs' legal ability to make the decision. But Petersen said the maneuver was unlawful and warned that decisions made by what he called the "fake directors" would be "dubious" and subject to lawsuits.
Yee said she didn't coordinate her action with Petersen or anyone else. She believes strongly in the nomination process as a former state Senate majority leader, she said, noting that she held up several nominations by former Republican Gov. Doug Ducey when questions were raised about the nominees' qualifications.
She consulted with lawyers after learning that Hobbs' was "blatantly circumventing the law" by rejecting the confirmation process, and they told her "we could not legally recognize these individuals in the open meeting" of the Board of Investment.
Under state law, the directors of the departments of Administration and Insurance and Financial Institutions or their "designees" are members of the Board of Investment, along with the state treasurer and two other members assigned by the treasurer. They're supposed to meet monthly to review the state's investments.
Arizona Gov. Katie Hobbs announces that Google is building a $600 million data center in Mesa during a news conference at The Studios at Mesa City Center on Sept. 6, 2023, in Mesa.
The nominees can legally serve up to a year without confirmation. But Hobbs' withdrawal of the nominees from any Senate confirmation process means "there was no longer a record of a process" for which these directors could sit for a year without Senate confirmation" that would allow them serve even as unconfirmed interim directors, she said.

https://www.azcentral.com/story/news/politics/arizona/2023/09/27/arizona-treasurer-yee-bars-2-hobbs-appointees-from-investment-meeting/70986028007/