First up: a gold depository in Texas. And then?
BY ANNA M. TINSLEY
A gold depository in Texas is just the first step.
After work begins on the state’s first bullion depository — and proposals to create it are due by the end of the week — then officials hope to bring more commodity markets to the state.
“Gold is just the first thing,” said state Rep. Giovanni Capriglione, R-Southlake, who asked lawmakers last year to create the depository. “We have been talking to other commodity players, asking if we can create a bigger platform.
“This is just the beginning of something we are starting.”
After a gold depository is up and running, he said, officials should look at cattle, oil, gas and more.
“We want to say Texas is a place where you can go and not only buy and sell commodities, but you can receive a shipment of those products as well,” Capriglione said. “I see us being able to start turning this into something much more.”
But first things first.
Companies interested in creating the Texas Bullion Depository must turn in their proposals by Friday.
State officials will choose the winning proposal and a schedule already laid out calls for work on the depository to be under way by Dec. 1.
The depository, under the new Texas law, would give Texans a place to store their gold and other precious metals. But it wouldn’t be just for residents. Financial institutions, cities, school districts, businesses, individuals and countries could do business there as well.
Storage fees will be charged to generate revenue for the state.
About a dozen companies weighed in last year, offering suggestions on how to help Texans store their gold and precious metals. Those businesses very well might submit proposals to develop a Bullion Depository here.
“There’s a lot of excitement for this,” said Chris Bryan, a spokesman with the Texas Comptroller’s Office.
Bring the gold home
Capriglione recently visited New York with fellow lawmaker state Rep. Tan Parker, R-Flower Mound.
The two took a picture outside the HSBC Bank in New York, where an estimated $650 million owned by the University of Texas Investment Management Company is now stored.
“We have our gold in New York City,” Capriglione said. “It doesn’t make sense for our gold to be in New York City.”
Especially since the company pays about $650,000 a year to store the gold there — payments that instead could be given to a Texas depository.
“We want to work on the depository to make sure the gold is back here in Texas,” Capriglione said.
As for the commodities plan, some say that further shows Texans’ continuing independence.
“The Texas economy has always been rooted in self-sufficiency. Since settlers first came to Texas, the state has cornered some part of the market on certain goods — first agriculture, then timber, oil, technology, and oil again,” said Brandon Rottinghaus, a political science professor at the University of Houston.
“Encouraging investment in commodities, including gold, is part of the state’s long-held economic ethos to embrace stability,” he said. “Texas as a hub of commodity commerce can strengthen and stabilize state finances.”
As for the gold depository, Texas law says it can hold deposits of gold and other precious metals from financial institutions, cities, school districts, businesses, individuals and countries.
Capriglione and others have long said this depository is similar to a bank that doesn’t do any lending.
It could be in one location, or multiple sites throughout the state, depending on which proposal the comptroller’s task force, which will make the selection, prefers.
“I have been waiting for this for several years now,” said Capriglione, who unsuccessfully proposed a depository in 2013. “It probably ranks up there with my anniversary and Christmas.