Four men served as territorial treasurer until Minnesota was admitted to the Union in 1858. The office of State Treasurer was formalized by Article V of the Minnesota Constitution in 1858. The position was originally a two-year elective term, but in 1963 the treasurer's term was extended to four years (constitutional amendment adopted November 4, 1958). The primary function of the office was to receive and account for monies paid into the state treasury until lawfully disbursed or invested. The treasurer was the custodian of all state funds, both cash and invested, including securities held for the permanent trust funds, the retirement associations, short-term cash investments, and securities pledged as collateral. The treasurer was a member of the state Executive Council and served as ex-officio treasurer of the Metropolitan Airports Commission.
In 1983, the legislature transferred responsibility for Unclaimed Property from the State Treasurer to the Department of Commerce.
Seven positions in the office of the State Treasurer were abolished and responsibilities of the state treasurer transferred to the commissioner of finance effective June 30, 1985 per Minn. Laws 1985 1st Sp. Sess. Chap. 13 Sec. 376.
Then Treasurer, Robert Mattson, and three remaining employees moved out of Capitol area offices in July 1985 after the Legislature stripped his office of most of its functions. The four moved to rented space in the lower level of the two-story duplex at 1208 Grand Av. to save money.
Mattson fought back, and in August 1986 the state Supreme Court ruled unanimously in his favor. The court ruled that although the Legislature has the power to modify the duties of offices established by the state Constitution, including that of treasurer, it does not have the power to "strip such an office of all its independent core functions." By transferring all functions related to the receipt of state money to the Department of Finance, the Legislature made of the treasurer's office "an empty shell," wrote Justice George Scott for the court.
In early September 1986, the office and staff returned to their capitol office. The nine employees transferred to the Department of Finance returned to the treasurer's office. Mattson and Deputy Treasurer Jim Dunlop said they will try to regain some of the abolished positions. The duties the office lost - receipt and disbursement of the state's money and investment of idle cash - were returned to the office.
During the 1997 and 1998 legislative sessions, the State Legislature discussed, debated, and ultimately passed a statute (1998 Minn. Laws, Chap. 387, Art. 1, Sec. 1) that placed a proposed amendment to the Minnesota Constitution on the ballot to abolish the Office of State Treasurer and requiring the transfer of the State Treasurer's powers, duties and responsibilities to an appropriate agency or constitutional office. The amendment included this wording:
If the proposed amendment is adopted, the office of
treasurer will be abolished on the first Monday in January 2003.
The amendment was adopted with 1,087,789 yes votes to 855,853 no votes.