State revokes licenses of two children's homes near Tucson

The state health department has revoked the licenses of a Southern Arizona children’s home operator with the worst health and safety record in the state. The decision to force the closure of two group homes southeast of Tucson follows a judge’s finding the operator, Mary’s Mission, knowingly and repeatedly misled state health inspectors and could not be trusted to provide a safe environment for troubled children.

William Lacey Jr. of Sierra Vista, chief executive of Mary’s Mission — which is registered as a charity but also claims to be a “BBB-approved business” — could not be reached for comment on the decision or whether he plans to appeal it.

He did not respond to an email request copied to his attorney, which the attorney received and read, according to a receptionist who answered the law office phone on Monday.

The two homes in neighboring Cochise County take in 11- to-17-year-olds from Tucson and beyond, many of whom came from abusive or unstable backgrounds and had emotional scars that impaired their ability to function. The cost of the care they receive at Mary’s Mission is largely funded by taxpayers through the state’s medical insurance plan for those with low incomes.

Since 2019, the facilities have been cited 64 times for deficiencies including chronic overcrowding, lack of nutritious food, faulty dosing of prescription medications and failure to demonstrate that residents were receiving adequate mental health care. The state has imposed more than $18,000 in fines.

Records had been falsified

In December, administrative law judge Tammy L. Eigenheer heard four days of closed-door testimony on whether the homes should stay open.

The Arizona Department of Health Services launched its shut-down effort in June after health inspectors responding to a complaint in April found a total of 50 violations at the two facilities.

Twenty-four of those violations — including overcrowding, falsifying documents, failure to ensure employees had criminal background checks, failure to ensure staffers were qualified and failure to document when residents ran away — formed the basis of the state’s revocation case.

The health department said four records were falsified: a fire inspection report for an illegal building addition; a list of boys home residents that concealed the fact the home was overcapacity; a quality report copied and pasted from an identical report with a different date and a case in which a Mary’s Mission billing clerk signed a resident’s psychotherapy treatment plan as if she was a state-licensed mental health professional.

Judge: Homes pose “danger”

The judge found the two homes posed “immediate danger” to residents and should not be allowed to continue operating.

Her 24-page written decision noted Lacey and three of his subordinates testified in support of keeping the homes open. They told the judge problems have been corrected and said the false information provided to health inspectors resulted from innocent errors by an employee who was admonished after the state pointed out the discrepancies.

But the judge rejected their testimony, ruling in favor of the health department and against Mary’s Mission on all 24 of the violations at issue in the case. In every instance, the “weight of credible evidence” supported the state’s version of events, Eigenheer said.

Back to homepage

Subscriber Login

Keep reading with a digital access subscription.

Subscribe now

The judge said she was especially concerned Mary’s Mission personnel had repeatedly “displayed a willingness to knowingly provide false and misleading information” to inspectors and gave testimony that, in one case, directly contradicted photographs taken by inspectors.

Lacey, 58, has refused for months to comment to the Arizona Daily Star, which first reported in August that Mary’s Mission had more state fines and violations than any of the 150 or so similar children’s home operators statewide.

A few days after the December state hearing, Lacey and his lawyers and subordinates did provide comments to the Sierra Vista Herald in which they claimed a state inspector and a local fire official had engaged in “collusion” to shut them down.

It isn't clear if Lacey raised the collusion claim during the hearing. it wasn't mentioned in judge’s written decision.

The state hearing also was scheduled to review a cease and desist order the state imposed on Mary’s Mission in June for operating an illegal, unlicensed third group home not far from its other two homes. The matter was dropped when Mary’s Mission decided not to fight the state order.

A business or a charity?

It isn’t clear what will become of Mary’s Mission, which reported nearly $1.9 million in tax-exempt revenue on its most recent nonprofit tax return, with Lacey receiving a salary of $191,000.

The group homes are central to the organization’s charity status. Their purpose, as stated on tax returns, is to “provide a safe environment for at-risk boys and girls who were either wards of the state or homeless due to circumstances that they could not control.”

Mary’s Mission’s own website raises questions about whether the organization is adhering to federal regulations that govern nonprofit agencies.

The website describes Mary’s Mission as a “BBB-accredited business” which — if true — could run afoul of a rule that requires nonprofits to be “organized and operated exclusively” for nonprofit purposes.

The Better Business Bureau Serving Southern Arizona says it has no connection to Mary’s Mission. BBB spokeswoman Dennise Alvarez told the Star the organization doesn’t qualify to be a BBB-accredited business since it’s a nonprofit.

The use of the BBB’s accreditation logo “constitutes trademark infringement,” and Mary’s Mission will be notified to take it down, she said.

Lacey, the CEO, has declined to answer questions about the website.