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Texas could create its own Fort Knox to store gold
By Mike Ward
Tuesday, May 26, 2015
AUSTIN, Texas -- Texas could get its own version of Fort Knox, the impenetrable repository for the nation's gold bullion, if the Legislature gets its way.
Under House Bill 483, approved unanimously on Tuesday by the state Senate, Comptroller Glenn Hegar would be authorized to establish and administer the state's first bullion depository at a site not yet determined.
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No other state has its own state bullion depository, officials said.
Sen. Lois Kolkhorst, R-Brenham, said the state and its agencies have more than $1 billion worth of gold that now is kept in secure facilities in other states. She said there is concern that fortune should be in Texas.
An official analysis of the bill explains: "The establishment of a Texas Bullion Depository would allow the state, state agencies, and private individuals to store precious metals utilizing a secure Texas-based depository to reduce reliance on out-of-state facilities and to insulate their assets from unstable market forces."
The new depository would be operated as an office within the comptroller's agency.
"Would this be like Fort Knox?" asked Sen. Juan Hinojosa, D-McAllen. "If I have gold in my possession, can I deposit it?"
Yes, Kolkhorst said, the new depository would be available for his deposits and those of other Texans, and would save the state money.
"The state has gold, and several years ago (the University of Texas Investment Management Corp.) purchased just under a billion dollars worth of gold," she said. "Most of the bullion depositories are in New York -- there may be a small one in Delaware -- and they charge the state a fee to store each bar of gold."
The United States Bullion Depository, located at Fort Knox in Kentucky, adjacent to a U.S. Army base by the same name, was built in the late 1930s to hold the nation's gold reserves. Its name has become synonymous with impenetrable security. In addition to holding the country's gold reserves, Fort Knox has been used as secure storage for vital documents over the years, including the Declaration of Independence and the U.S. Constitution.
Kolkhorst said UTIMCOin March had 5,610 gold bars in its portfolio, an investment worth $645 million, and was being charged a storage fee of $108 per bar by a bullion depository in New York City, a total of more than $605,000 a year.
HB 483 was filed by Rep. Giovanni Capriglione, R-Southlake, the president of a private equity company, and is co-authored by 31 other colleagues. It passed the House 140-1 this month.
"New York will hate this," Kolkhorst said of the bill that now goes to Gov. Greg Abbott to be signed into law. "To me, that and the fact that it will save Texas money makes it a golden idea."
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