Committee hears bill requiring Attorney General review of contingency-fee contracts by political subdivisions

A Kansas Legislature Judiciary Committee hearing on Senate Bill 242 focused on new limits and an approval process for contingency-fee contracts between political subdivisions and private lawyers.

The bill would require a governing body to call a public meeting to consider a proposed contingency-fee contract, make a written finding that the services are substantially needed and cannot be performed by the subdivision’s own attorneys, and approve the contract in an open meeting. Before becoming effective, the approved contract would be submitted to the Kansas Attorney General’s Office with the contract, a description of the legal matter and the governing body’s written findings; the attorney general would have a statutory review period to approve or refuse the contract, or the contract would be deemed approved if the attorney general takes no action within the statutory review window. Existing contingency-fee contracts entered before July 1, 2025, would have to be submitted to the attorney general by July 1, 2026. The bill as drafted would automatically expire July 1, 2029.

Proponents said the bill preserves the attorney general’s role in matters of statewide concern while allowing local governments to pursue purely local claims. Jennifer Artman, partner at Shook, Hardy & Bacon, told the committee the measure seeks to “facilitate coordination with the state attorney general’s office and the local governments” and to provide “transparency for those local governments whenever they’re seeking to proceed” on contingency-fee class actions. Roger Geboni of the U.S. Chamber Institute for Legal Reform said the bill’s review mechanism “ensures the involvement and input and respects the sovereign authority of the state's duly elected attorney general.”

Office of Attorney General representatives and supporting groups described changes negotiated with municipal groups. Robert Hutchison, acting chief deputy attorney general, said the parties have discussed shortening the attorney general’s review period; the bill text originally set 90 days, and Hutchison confirmed a proposed amendment would shorten that to 45 days so municipalities get an answer sooner. Hutchison also said the office is prepared to clarify the statutory bases for approval or refusal and to work with municipalities on carve-outs for matters that are purely local.

Opponents requested narrower language and raised concerns about local control, confidentiality and administrative burden. John Goodyear, general counsel for the League of Kansas Municipalities, said the league opposed the bill as written but had reached proposed amendments with the attorney general’s office; the amendments would narrow the defined categories of legal services that must be submitted and shorten look-back requirements for prior contracts. Shannon Kimball of the Kansas Association of School Boards said school boards are “the constitutionally designated governing body” for local school districts and warned the measure could override locally elected boards’ fiduciary duties and require disclosure of privileged communications that boards receive from retained counsel.

Several neutral and opponent witnesses urged clearer definitions and narrower scope to avoid pulling routine contracts — for example, bond counsel, debt collection or court-trustee collections — into the attorney general review. Travis Harrod, a district court trustee, and Larry Zimmerman of the Kansas Creditor Attorney Association both asked the committee to exempt district court trustee arrangements and routine local collection contracts from the bill’s coverage; witnesses said a balloon amendment circulated among conferees seeks to address several of those concerns.

Committee members asked about experience in other states and about administrative capacity. Hutchison said he believed Texas and other states have enacted similar oversight measures but did not provide a line-by-line comparison. Hutchison told the committee the attorney general’s office does not currently anticipate hiring additional staff to perform reviews and expects to absorb the work into existing review processes for other legal instruments. Several conferees noted that narrowing the bill’s definition of covered legal services would significantly limit the number of contracts sent to the attorney general.

The hearing closed with requests that proposed amendments be submitted for the committee record and continued negotiation between the attorney general’s office, municipal associations and other stakeholders. There was no formal committee vote on the bill at the hearing.

Senate Bill 242: key provisions described at the hearing - Required public meeting and written finding by the governing body prior to approval of a contingency-fee contract. - Submission to the attorney general of the approved contract, description of the legal matter and the governing body’s written findings; statutory review period (draft bill: 90 days; amendment discussed: 45 days). - Attorney general may approve or refuse and must provide written reasons if refusing; deemed approved if no action within the statutory review window. - Attorney general may appear in court and request dismissal of proceedings if a contingency engagement violates the statute; courts would be required to grant dismissal if the contract does not comply. - Existing contingency-fee contracts entered before July 1, 2025, must be submitted to the attorney general by July 1, 2026. - Section in the draft bill would expire July 1, 2029.

The committee heard broad testimony for and against the bill and discussion of a balloon amendment that proponents and municipal representatives said would narrow coverage, shorten the review window and add clarifying language. The committee did not take final action during the hearing; conferees pledged further work on definitions and carve-outs and to submit formal amendments for the record.