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Mon, Feb. 17

Prescott’s total of sober-living homes drops below 30
Under new law, state will take on regulatory authority

From a high of 200 or so in 2016, the number of sober-living homes in Prescott has now declined by nearly 90 percent — to a total of 28.

That is down once again from the low of 35 that the city reported in February.

Local officials have credited the strict city regulations imposed in early 2017 as being partially responsible for the continuing decline in the number of group recovery homes.

Within the next two years, however, the city will relinquish its local regulation of the sober-home industry to the state of Arizona.

A new state law is set to go into effect in early August that will direct the state to incrementally take on the regulatory authority for sober-living-home licensing throughout Arizona.

City Attorney Jon Paladini reported this past week that the Arizona Legislature approved a bill in the 2018 session that will give the Department of Health Services (ADHS) the authority to impose its own set of regulations.

While the state bill provides a two-year period for adoption of the regulations and the start of licensing, Paladini expects the state rules to closely mirror Prescott’s 2017 ordinance.

“When all is said and done, I don’t think there will be a substantial difference from what the city did,” he said.

The state bill (Senate Bill 1465) states that the standards for certification would require sober-living homes to have policies on elements such as: drug and alcohol testing; promoting safety of the surrounding neighborhood and community at large; discharge of residents that does not negatively affect the community; criminal background checks for owners and employees; and rules that prohibit owners or employees from taking commissions or fees for admission of a resident.


Paladini made a report on the pending state law last week to the Mayor’s Commission on Prevention, Addiction and Recovery — the city’s new citizen group overseeing sober-living homes.

He told the group that the state’s Department of Health Services (ADHS) would be setting the specific standards, and that the city’s ordinance would be revoked in two years.

In the meantime, Paladini suggested that local officials and members of the committee become as active as possible in the committee that will be working on the new rules. “Prescott needs to push to be heavily involved,” he said.

The main difference between the state bill and Prescott’s action, Paladini said, is that the city spelled out the regulations in its ordinance, while the state bill directs the director of the ADHS to adopt the regulations.

Based on 2016 state legislation that allowed for it, the Prescott City Council approved an ordinance, effective January 2017, that called for minimum standards on matters such as training for house managers, exit policies for residents who are asked to leave the facilities, and criminal background checks on employees.

Although other factors have been involved as well, such as stricter enforcement of claim rules by insurance companies, the city has maintained that the new ordinance helped to get control of the burgeoning problem with group homes.

In response to questions from commission members, Paladini said the city’s group home number peaked at about 200, and this past week, the city’s budget and tax division reported that the number of city-regulated home now stands at 28 (plus about 10 more that opted to be licensed through the state).

“I think we’ve sort of achieved what we needed to achieve,” Paladini said.


Despite the decline in numbers, members of the mayor’s commission noted that issues persist with some of the homes.

Along with the bill on sober-living-home regulation, the state Legislature also approved Senate Bill 1451, which prohibits patient brokering or “patient referral inducements.”

The bill defines brokering as offering, paying, soliciting, or receiving any commission, bonus, rebate, kickback or bribe “to induce the referral of patients or patronage to or from a health care provider, health care facility or structured sober-living home.”

Commissioner Mo Michael said a handful of group homes continue to engage in brokering.

“It’s happening here in Prescott,” Michael said. “There are at least four facilities that I know of.”

Because of the continued fraud by some group homes, Commissioner Molly McGinn said, “The good guys are struggling, because the traffic is being directed elsewhere.”

In extreme cases, Michael and McGinn said, some group homes urge — or even pay — clients to relapse in their addiction in order to trigger a higher level of insurance coverage.

Paladini said the new state law, which also will go into effect in early August, will ban brokering and would impose felony charges for those who engage in the practice.

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