WeVote
Log In

Bill

Bill

HB 3347

Creates new provisions for political subdivisions contracts for legal services

2026 Regular Session Introduced by Jim Murphy

The bill requires public need, AG approval, and open-meeting oversight for contingent-fee legal contracts by political subdivisions.

HCS Reported Do Pass (H) - AYES: 5 NOES: 2 PRESENT: 0
#contractsandcontractors #politicalsubdivisions
0
WeVote Research Nonpartisan
Bill Summary · HB 3347

Summary of HB 3347 (2026) – Missouri: Political Subdivisions Contingent Fee Legal Contracts

Purpose and intent

  • HB 3347 adds a new statutory framework (Section 67.5500, RSMo) governing contingent fee contracts for legal services entered into by political subdivisions.
  • The bill aims to increase transparency and oversight by requiring public process and state-level AG approval before contingent fee contracts become effective.
  • It also introduces a mechanism for the Attorney General (AG) to review, approve, or deny contracts and to intervene in ongoing cases with noncompliant contingent fee contracts.

Key provisions and changes

Definitions

  • Contingent fee: A fee contingent on the outcome of the matter.
  • Political subdivision: Includes state and local governments, municipal and quasi-municipal entities, boards, authorities, and similarly structured units that receive/use public funds; also includes municipalities (cities, towns, villages) incorporated under Missouri law.

Conditions for entering a contingent fee contract

  • The governing body must hold an official public meeting to consider the contract.
  • Notice for the meeting must include:
    • Reasons for pursuing the matter and desired outcome.
    • Qualifications, experience, and competence of the attorney or firm.
    • Any relationships between the subdivision and the attorney/firm.
    • Why internal resources or hourly contracts are inadequate.
    • How the contingent arrangement benefits residents.
  • The governing body must make written findings that:
    • There is substantial need for the legal services.
    • The services cannot be adequately performed internally.
    • The services cannot reasonably be obtained through hourly-rate contracts given the matter or resource constraints.
    • The contract is approved in an open meeting.

Structure and safeguards of contingent fee contracts

  • Subdivision retains ultimate control over the case; final resolution remains with the subdivision.
  • Contingent fees may not exceed limits set by state rules for contingency fee contracts (comparator to state-level limits under §34.378 subsections 7-8).

Attorney General approval and oversight

  • Before the contract becomes effective, the subdivision must obtain AG approval.
  • The AG receives:
    • A copy of the proposed contract.
    • A description of the legal matter.
    • A copy of the meeting notice and a description of its method.
    • A copy of the written findings.
  • The AG must act within 45 days of receipt:
    • Approve the contract (promptly for purely local matters).
    • Or refuse for specified reasons (e.g., overlapping state interests, risk of inconsistent outcomes, or noncompliance with Missouri rules of professional conduct).
  • If the AG does not act within 45 days, the contract is deemed approved.

Enforcement and compliance

  • If a case involves a noncompliant contingent-fee contract, the AG may appear and seek dismissal.
  • If a court determines noncompliance, the case must be dismissed without prejudice.
  • Ongoing cases created before August 28, 2026, are grandfathered and proceed unless the AG intervenes.

Grandfather provision and other scope notes

  • Grandfather clause: Section 67.5500 does not apply to lawsuits filed before August 28, 2026, unless the AG intervenes.
  • Additionally, a related section (Section 311.038) preempts local alcohol regulation, giving the state exclusive authority over container size, fluid ounces, alcohol content, and per-transaction container limits. Local laws attempting to regulate these aspects would be void as of the effective date.

Who would be affected

  • Political subdivisions and municipalities that enter into contingent fee contracts for legal services.
  • State agencies, particularly the Office of the Attorney General (AG) and, to a lesser extent, the Office of the State Courts Administrator (OSCA).
  • Local governments may experience delays or constraints due to AG review; potential increased costs associated with AG oversight.
  • Law firms and attorneys providing contingent fee services to political subdivisions.

Procedural and timeline aspects

  • Public meeting and written findings required before contracting.
  • AG approval required before contract becomes enforceable.
  • 45-day review window for AG decision; contract deemed approved if no action taken.
  • AG may intervene in ongoing cases to request dismissal if noncompliant.
  • Grandfathered lawsuits: pre-August 28, 2026, proceed unless AG intervenes.
  • The fiscal note indicates substantial anticipated costs to the AGO (approximately 3 FTE and over $320k starting FY 2027, rising in subsequent years), with potential unknown costs to local governments due to contract review delays.

Fiscal impact (highlights)

  • State government (General Revenue):
    • Net cost: about $323,669 in FY 2027, increasing to $379,588 by FY 2029.
    • 3 additional FTE in AGO.
  • Local governments:
    • Potential unknown costs due to review delays; exact impact depends on numbers of contingent-fee contracts reviewed.
  • OSCA: potential but unquantified impact; not expected to be significant at this time.
  • Small business: no direct impact anticipated.

Administrative status

  • The House Committee substitute (HCS) for HB 3347 was reported Do Pass with a committee vote of 5-2, indicating legislative momentum to advance the bill.

Compiled from official sources — confirm details with the bill’s official record.

Sign in to ask a question.