Hold on to that gold, Texans.
Plans are underway to create a depository here to hold gold bullion and other precious metals, but it’s not ready yet.
State officials still have to hammer out the details — figuring out where it will be, ensuring the safety and security of the assets, developing rules and regulations to guide the service.
“We are not reinventing the wheel,” said state Rep. Giovanni Capriglione, R-Southlake, author of the bill to create the depository. “But we are going from a wooden wheel to a golden wheel.
“There are a lot of technical issues,” he said. “This has never been done before.”
Texas drew national attention this year — amid speculation that the state was challenging the Federal Reserve and preparing for secession — when lawmakers approved a plan to create a Texas Bullion Depository and Gov. Greg Abbott signed it into law.
The goal is to give people a secure facility to store precious metals and to let Texas bring home around $1 billion in gold bars stored elsewhere. The state could even earn money by charging people who store gold.
No one has done this before. We are trying to get questions answered.
Chris Bryan, a spokesman for the comptroller’s office
“The Texas Bullion Depository will become the first state-level facility of its kind in the nation, increasing the security and stability of our gold reserves and keeping taxpayer funds from leaving Texas to pay for fees to store gold in facilities outside our state,” Abbott said at the time.
If all goes well, the depository could be up and running by the first or second quarter of 2016.
That can’t happen soon enough, said Capriglione, who has fielded calls for months from people interested in storing their gold.
“Regular Texans can put their gold in there,” Capriglione said. “I’ve heard from so many individuals who have their own gold. Maybe they’ve been buying a little bit of silver or gold every month or year.
“They don’t feel comfortable keeping it at their house, but they don’t know what to do with it.”
The depository could not only hold deposits of precious metals but also let customers open accounts and pay for transactions with them. Many see it as another way for Texans to assert their independence.
It would “allow private citizens and companies to exchange goods and services based on their deposits, in some respects [creating] a mini-gold standard here in Texas,” said Mark P. Jones, a political science professor at Rice University in Houston.
“Some conservatives, especially those who fear their gold might be confiscated by the government, may feel more at ease knowing their gold is stored in ‘Come and Take It’ Texas rather than, for instance, in liberal New York,” he said.
Even Texas could bring home about $1 billion in gold bars owned by the University of Texas Investment Management Co. They’re now stored in the HSBC Bank in New York.
Some have called the creation of the depository the “Texas gold repatriation program.” Others have said the depository could pose a threat to the Federal Reserve, the country’s central bank.
Capriglione said the depository could offer an alternative to people skeptical of the federal government and the Fed.
“But we are never going to get rid of the Federal Reserve System,” he said. “It is long-standing in the market.”
He said he is even getting calls from lawmakers in other states who want to know how to set up their own depositories.
2015 was the second time Rep. Giovanni Capriglione proposed this bill. He found more success this year when he said the state would hire an outside firm to manage the depository.
Details, details, details
The first goal is to get the depository up and running.
But all the questions about how exactly it will work — How do you make deposits? Who will run the depository? How much will storage fees be? — have yet to be answered.
Some answers could come soon from a task force created by Texas Comptroller Glenn Hegar.
Comptroller employees were named to the task force and have developed a list of questions that was posted online Friday, asking companies to weigh in on issues that the depository could face.
The goal is to “try to get a better understanding of how the industry operates and how a depository might operate,” said Chris Bryan, a spokesman for the comptroller’s office.
“No one has done this before,” he said. “We are trying to get questions answered.”
At the top of the list is where to put it.
“Where could it be? It’s too early to know,” Capriglione said. “… We need somewhere that has easy access.”
One storage area could be in North Texas, another in Austin, maybe a third elsewhere.
“We are looking at what is the best physical location — a secure and stable site and one that’s economically advantageous to the state,” Capriglione said.
After those questions are answered, he said, the idea of creating a depository will move closer to reality.
“Obviously, this is about the security and safety of assets.”