Texas Has a Gold Depository

At present, The University of Texas and Texas A&M Investment Management Company hold $861.4 million worth of gold stored with HSBC bank in New York City. Hegar’s office is working towards bringing these precious metals home to Austin through creating the inaugural state-run bullion depository.

Hegar’s office has chosen Lone Star Tangible Assets from Austin as their provider to build and manage the Texas Bullion Depository. Here is how this depository operates.

What is the Texas Bullion Depository?

The Texas Bullion Depository offers an outstanding user experience with industry-leading technology, security and insurance measures. This vault features multiple levels of safety including dual controls in restricted areas, video surveillance, armed guards on site, recorded ingress/regress for all personnel entering or leaving, chain of custody monitoring 5S operations methodology as well as depositor access anytime for their account information, with fully insured shipments up to $1 Million coverage available to depositors.

Many investors are buying gold and other precious metals to hedge against uncertain economic times both here and abroad, in search of safe storage facilities to take advantage of tax exemptions. Leander will soon welcome its own secure depository managed by Lone Star Tangible Assets; designed specifically as a hardened fire-proof vault to house investments; Texas residents will pay a storage service fee to help cover expenses.

Why is the Texas Bullion Depository important?

State-run depository facilities represent a remnant of the gold standard and serve to challenge the Federal Reserve’s control over money. Texas Bullion Depository was the pioneering facility in its type and was officially inaugurated by Gov. Greg Abbott signing legislation creating it in 2015.

Last year, the comptroller’s office requested proposals from private vendors and selected Lone Star Tangible Assets as its contractor to run this facility. Lone Star already offers two websites where people can buy and sell gold; it also boasts vault space in Austin that meets high security specifications, according to Hegar.

Hegar’s goal for the Texas Bullion Depository is to make it accessible to financial institutions, cities, counties and government agencies, businesses and individuals as well as facilitate using sound money in everyday transactions – though that will likely take some time and work on its implementation will also need to take place separately. At present, it acts as an asset-protected safe deposit box, safeguarding owners investments.

Who will store their gold at the Texas Bullion Depository?

Texas residents who pay a fee can store their precious metals at the Austin facility run by Lone Star Tangible Assets and managed by the state comptroller’s office, accessible using an online portal.

Hegar believes the Texas depository will serve as a safe alternative to those located primarily around New York City. Her office worked tirelessly for two years to locate a private vendor to build and run it; currently the depository resides in a 23,000-square-foot building in downtown Austin.

Hegar expressed hope that Texas would eventually join the Chicago Mercantile Exchange’s COMEX platform, where gold futures contracts are traded, however this goal may prove challenging as its depository falls outside COMEX’s radius requirement and could thwart University of Texas plans to transfer $861.4 million worth of gold investments from New York to Texas depository.

How will the Texas Bullion Depository benefit the state?

At times of economic unpredictability, many individuals invest in precious metals like gold and silver. Individuals with such assets typically seek an efficient storage service like Texas Bullion Depository to protect them safely.

As it is a state agency, this depositary will be subject to stricter standards and oversight than depositories run by private entities. Furthermore, depositors will receive reimbursement in case of theft or natural disaster losses.

Hegar’s office completed a two-year search process before choosing Lone Star Tangible Assets of Austin, an expert in moving and storing metals, as its operator for the state-administered depository. It will open next year for individuals, businesses, institutions as well as mining companies who wish to store treasury gold or other precious metals without leaving state borders.

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