STATE TREASURER

ORIGIN & FUNCTIONS

[photo, Goldstein Treasury Building, 80 Calvert St., Annapolis, Maryland]

The office of Treasurer originated in the late seventeenth century. Under crown rule, a treasurer of the Eastern Shore and a treasurer of the Western Shore were appointed by the General Assembly with the approval of the governor and council. When proprietary rule returned in 1715, the governor appointed the two treasurers. The dual offices continued under the new State government created at the start of the American Revolution.

The Constitution of 1776 provided for two State treasurers - the Treasurer of the Eastern Shore, and the Treasurer of the Western Shore - each elected by the House of Delegates (Constitution of 1776, sec. 13). Later, these two offices were consolidated by the General Assembly. For in 1843, the office of Treasurer of the Eastern Shore was abolished, and its duties were assumed by the Treasurer of the Western Shore (Chapter 200, Acts of 1841; Chapter 239, Acts of 1842).

Goldstein Treasury Building, 80 Calvert St., Annapolis, Maryland. April 1999. Photo by Diane P. Frese.

The Constitution of 1851 authorized a single treasurer of the State to be elected for a two-year term by joint ballot of both houses of the General Assembly (Art. 6, sec. 1). In 1922, the term was increased to four years (Chapter 140, Acts of 1922). The first full-time State Treasurer was not elected by the Legislature until 1973.

Today, the State Treasurer is chosen by joint ballot of both houses of the General Assembly at the first regular session of the Legislature in each gubernatorial term of office. The State Treasurer thus serves a four-year term coinciding with that of the Governor.

The State Treasurer is responsible for the management and protection of State funds and property. This involves the receipt, disbursement, safekeeping, and investment of the funds of the State Treasury. In this connection, the Treasurer selects and manages the depository facilities for State funds, issues or authorizes agents to issue payments of State funds, invests excess funds, safekeeps all State securities and investments, and provides insurance protection against sudden and unanticipated damage to State property or liability of State employees. Moreover, the State Treasurer is custodian of all stocks, bonds, promissory notes, certificates, and other negotiable investment instruments of the State. In addition, the State Treasurer is custodian of all such instruments held for the State Retirement and Pension System, the Maryland Insurance Commissioner, foreign building and homestead associations, the Department of the Environment's Coal Mining Division [Bureau of Mines]; and all collateral pledged as security over deposits of State funds in Maryland banks.

State of Maryland General Obligation Bond issues are planned, prepared, and advertised by the State Treasurer. With the approval of the Board of Public Works, the Treasurer arranges bond sales; prepares the State's Official Statement; receives bids; and arranges settlement, delivery of bonds, and tracking of the proceeds for these General Obligation Bonds. Due to new restrictions by the federal government on income generated through the sale of tax-exempt obligations, the Treasurer most recently has played an increasing role in the administration of the State's capital program. In 1990, the State issued the first Maryland Mini Bonds, which are small denomination capital appreciation bonds. This program is administered by the Treasurer.

[photo, Goldstein Treasury Building, Annapolis, Maryland]

Under authority delegated by the Board of Public Works, the State Treasurer is responsible for the procurement of all financial and insurance services of the State. In this regard, the Treasurer competitively procures services concerned with banking, investment, safekeeping, financial advice, debt underwriting, insurance protection, claims adjusting, investigations, and some printing (Const., Art. VI, secs. 1-6; Code State Government Article, secs. 5-101 through 5-107, 12-104).

As of June 1, 2023, the General Assembly authorized the State Treasurer to oversee the Maryland 529 Program (Chapter 113, Acts of 2023; Code Education Article, secs. 18-901 through 18-917).

Goldstein Treasury Building, Annapolis, Maryland, July 2010. Photo by Diane F. Evartt.

The State Treasurer office encompasses additional duties, and includes chairing the Capital Debt Affordability Committee, the Commission on State Debt, and the Board of Trustees of the State Retirement and Pension System. By law, the State Treasurer also is a member of the Board of Public Works and serves on the Board of Trustees of the Maryland Agricultural Land Preservation Foundation; the Board of State Canvassers; the Commission on Climate Change; the Financial Education and Capability Commission; the Governor's Salary Commission; the Maryland Green Purchasing Committee; the Hall of Records Commission; the Maryland Health and Higher Educational Facilities Authority; the Procurement Improvement Council; the Board of Revenue Estimates; the Maryland Small Business Retirement Savings Board; the Maryland State Employees Surety Bond Committee; and the 21st Century School Facilities Commission.

OPERATIONS

Within the State Treasurer's Office, Operations oversees five divisions: Budget and Accounting; Debt Management; Information Technology; Insurance; and Treasury Management.

BUDGET & ACCOUNTING DIVISION

The Budget and Accounting Division first formed as the Administration Division, and reorganized as the Budget and Administration Division in 2013. It was renamed as the Budget and Accounting Division in January 2022.

DEBT MANAGEMENT DIVISION

By 1989, the Debt Management Division began as the Financing Division and restructured as the Investments and Finance Division by 1994. It reorganized in 2001 as the Finance Division, and in January 2006 assumed its current name.

The Division oversees the State Debt, maintains its credit rating, handles bond sales, and manages the Master Lease Program, which enables State agencies to finance procurement of equipment over a period longer than the twelve-month budget cycle.

INFORMATION TECHNOLOGY DIVISION

The Information Technology Division was known first as the Data Processing Division by 1994, reformed as the Information Systems Division in 2000, and adopted its present name in 2002.

To the State Treasurer's Office, the Division provides local area networking, internet access, e-mail, application development, website updates, software evaluation, and data communications.

INSURANCE DIVISION

In accordance with the Maryland Tort Claim Act, all claims against the State must be filed with the Office of State Treasurer. The Insurance Division processes such claims, and also has authority over insurance coverage for State-owned property, and the payment of claims awarded by the Board of Public Works. Funding for the Division's work comes from the State Insurance Trust Fund.

TREASURY MANAGEMENT DIVISION

As the Investments Division, the Treasury Management Division organized by 1989, and reorganized by 1994 as the Investments and Finance Division. It reformed again as the Investments Division, its original name, in 2001. Then in 2012, the Investments Division merged with the Banking Services Division to form the Treasury Management Division.

The Treasury Management Division oversees a program primarily oriented to the investment of cash balances which exist between the time of State revenue collection and disbursement. The Division also is concerned with longer term investments, including the redemption of certain bonds, the purchase of 20-year development easements on agricultural land, and the payment of lottery prizes over 19-year periods. In addition, the Division manages the investment of General Obligation bond proceeds, and directs short- and long-term investments of trustee accounts under State agency revenue bond indentures. Interest on these investments accrues to the General Fund unless State law or regulation directs otherwise (Code State Finance & Procurement Article, secs. 6-222 through 6-226).

The State Treasurer is responsible for the deposit and disbursement of State funds (Const., Art. VI, sec. 3). In fulfillment of that obligation, the Treasury Management Division manages the flow of all receipts and disbursements of State funds.

MARYLAND LOCAL GOVERNMENT INVESTMENT POOL ADVISORY COMMITTEE

The Committee reviews the activities of the Pool's investment manager, and generally advises the State Treasurer on investment performance.

Committee members include representatives of local governments currently investing in the Maryland Local Government Investment Pool, which provides participants with a safe short-term investment for their funds.

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