You asked what the source of the state treasurer's investment authority is and whether it is constitutional or statutory, which states give their treasurers sole fiduciary responsibility for investments, and what options the General Assembly has to change the treasurer's investment powers.

SUMMARY

The treasurer derives her sole authority over investment decisions from the statutes, not the State Constitution. The General Assembly can alter the powers and duties of the office by enacting legislation to do so. In 19 other states, the treasurer alone determines investment policy.

TREASURER'S INVESTMENT AUTHORITY

The statutes authorize the state treasurer to "invest as much of the state's trust funds as are not required for current disbursements…" (CGS § 3-13d). Other sections require the treasurer to appoint an assistant treasurer for investment and create the Investment Advisory Council (CGS §§ 3-13a and 3-13b). But the assistant treasurer serves at the treasurer's pleasure and the council's duty is to review the treasurer's investments and recommend investment policies.

The State Constitution establishes the office and requires the treasurer to "receive all moneys belonging to the state, and disburse the same only as he may be directed by law" (Ct. Const., Art IV, § 22). There is no reference to investment duties.

LEGISLATIVE OPTIONS

Since the treasurer's responsibilities are specified in the law, the General Assembly has the power to change them by amending the statutes related to the treasurer's powers and duties. Constitutional changes would have to be approved first by the legislature, then by voters at a statewide election. But since the particular authority regarding investment powers is statutory, the matter need not go to the voters as a proposed constitutional amendment.

In fact, the treasurer's office proposed legislation in 1996 (SB 442) that would have established a Board of Trustees of the Connecticut Retirement and Trust Funds to share fiduciary responsibilities with the treasurer, among other changes. The Government Administration and Elections and Finance, Revenue and Bonding committees reported the bill, which died on the Senate calendar.

OTHER STATES

The National Association of State Treasurers (NAST) identifies 20 states where the treasurer alone determines investment policy. Elsewhere, the treasurer either shares the responsibility or some type of investment board, committee, or council makes investment decisions.

The NAST publication State Treasury Activities & Functions lists the following states where the treasurer is solely responsible for state investment policies:

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