Does Texas Have a Gold Depository?
Gold depository could be an invaluable resource for cities, school districts, businesses, individuals and other countries alike. Indeed, Governor Greg Abbott recently passed legislation setting the groundwork for just such a depository.
Texas Comptroller Glenn Hegar’s office has chosen an Austin-based vendor to construct and operate the state bullion depository, giving Texas citizens an alternative means of depositing precious metals at COMEX East Coast facilities. Once complete, it will provide safe storage solutions close to home for precious metal deposits.
What is the Texas Bullion Depository (TxBD)?
The Texas Bullion Depository (TxBD), created under the 84th Legislature, provides Texas citizens with a safe place to store precious metals. It was inspired by concerns regarding University of Texas/Texas A&M Investment Management Co.’s ownership of hundreds of millions worth of gold bullion stored for a fee in New York City vaults by University of Texas/Texas A&M Investment Management Co.
To avoid overcharging clients for storage services, lawmakers decided not to fund TxBD directly but instead entered into a profit-sharing agreement with Lone Star Tangible Assets (LSTA), an outside private investment firm which built and operates TxBD under supervision from the Comptroller’s office.
TxBD is located on a 10-acre campus just north of Austin in Leander and within easy driving distance from both the Capitol and Comptroller’s Office. Our facility is covered by an all-risk policy underwritten by Lloyd’s of London – one of the premier insurers of specialized assets – so all gold, silver and platinum holdings at TxBD can be fully segregated, sealed off from outside interference, audited annually by outside auditors and insured with this policy.
Why is it important to store your gold in a depository?
As opposed to burying it in your backyard, storing gold at a depository offers greater benefits in terms of security and accountability, along with convenient online access at any time; you remain in full control of your precious metal at all times.
Leander facility will store an unprecedented $350 billion worth of gold and other precious metals – more than twice what Fort Knox, an existing US Bullion Depository located in Kentucky currently contains.
Texas lawmakers passed legislation in 2015 mandating that Texas Comptroller Glen Hegar create the nation’s inaugural gold bullion depository. A year later, Hegar selected Lone Star Tangible Assets – an Austin-based precious metals storage firm with vault space that meets high security specifications – as the contractor to build and operate it under state oversight. Hegar noted this choice would enable fast activation of the depository with minimal impact to businesses or other government bodies storing gold bullion; they will charge storage fees accordingly.
How does TxBD work?
TxBD was established by the 84th Texas Legislature as an insured depository to offer Texas residents safe storage for precious metals. As it’s the only state-administered depository of its kind, it operates on a 10-acre campus near Austin in Leander. Oversight for daily operations of TxBD falls to Lone Star Tangible Assets (LSTA).
LSTA covers TxBD’s construction and operational costs while the Comptroller’s office covers administrative expenses. This business model ensures more transparency for taxpayers and customers while keeping fees to an absolute minimum.
Bullion stored at TxBD is insured against loss through an all-risk policy provided through Lloyd’s of London insurance market, offering much greater protection than that offered through private depositories. Furthermore, storing your bullion at TxBD means you will avoid sales tax in states which impose dealer-to-customer sales taxes (such as Arkansas, Hawaii, Ohio and New Mexico) when buying Precious Metals such as Arkansas Hawaii Ohio New Mexico). Wholesale Coins Direct can help acquire and arrange storage at TxBD.
What are the benefits of storing your gold in a depository?
One of the primary advantages of storing precious metals in a depository is security; depository storage facilities are government backed, which means higher standards than depository facilities operated by private companies. You also gain easy access to your precious metals via online portal and can keep a close watch on them at all times.
Some gold investors opt to store their bullion at home, giving them more privacy and control of their assets at all times. Others may choose a hybrid approach: keeping some at home while leaving other pieces in depository facilities or other storage facilities.
Some depository providers provide unallocated storage, which means your bullion may be mixed in with that of other investors’ precious metals and could potentially lower ongoing costs; however, this does bring with it some risks; only the top depository providers offer you detailed documentation regarding how your bullion is being stored.