Austin to be official home of Texas’ gold hoard
Ken Herman says bullion project is called a ‘monumental moment’ in state’s history — but don’t count on there being any free samples.
We (and by “we” I mean the Austin area) will be home of the new Texas Bullion Depository, an ambitious peculiarity that once fueled a round of secessionist talk.
The exact location of the TBD is TBD, but state Comptroller Glenn Hegar announced Wednesday that Austin-based Lone Star Tangible Assets has been selected to build and operate the facility.
It’ll start out in January at the firm’s existing North Austin vault and eventually move to a to-be-built facility for storing gold bullion and other metals considered precious.
Matthew Ferris, Lone Star Tangible Assets chairman, said the new facility will be 35,000 to 75,000 square feet, so there should be plenty of room and far more security for the gold bullion now under your bed or out back in your shed.
Hegar made the announcement at a very disappointing Wednesday news conference at the Capitol. Thanks to the presence of security folks and Comptroller’s Office camera crews, the room was pregnant with the promise of the presence of gold bars, perhaps wheeled in on carts, perhaps while Hegar sang “Goldfinger” and perhaps with free samples.
Nope. Just suited men talking suitably. But the talk was big, replete with superlatives about how Texas is doing something no other state has done.
Texas often does somethings no other state has done. Sometimes it’s good. Sometimes it has that “Hey, watch this!” feel that sometimes foreshadows tragedy.
“This has been a monumental undertaking,” Hegar said, calling the bullion depository idea “a very complex project with many unique challenges.”
Ferris, whose firm beat out five others for the five-year contract, called this “a monumental moment in the history of the state of Texas and in the modern history of the precious metals industry itself.”
The deal is pretty simple. Private investors and other holders of precious metals can stash them in the depository. A large potential customer could be University of Texas/Texas A&M Investment Management Co., the investment company that manages billions of dollars in stocks, bonds and other assets for the UT and A&M systems.
As of Wednesday, that entity (perhaps the only one in the world with UT and A&M in its title?) had $861.4 million in gold stored in a New York vault. No decision has been made on moving it to the new Austin facility.
I hope it is moved. I envision a caravan of pickups.
“We were thinking we’d have you as head of security if you want to be part of that team,” Hegar told me.
I’m going to turn down this offer. The closest thing I have to knowledge about bullion is I once thought about opening a broth IRA. (Stop groaning. That’s professional stuff right there.)
This whole process began in 2013 when state Rep. Giovanni Capriglione, R-Italy, filed legislation for creation of the Texas Bullion Depository. The bill failed. (And Capriglione is really from Southlake up in the Metroplex, not Italy, the small Texas town where he should be required by law to live.)
Undaunted, Capriglione tried again in 2015, telling me at the time that his 2013 effort was hampered by misconceptions.
“I think the perception of it was that it was assumed to be some sort of anti-federal government deal,” he said in January 2015. He tamped down that talk by toning down the bill, removing phrases, such as a “mechanism by which the system ... is able to function in the event of a systemic dislocation in a national or international financial system.”
The 2015 bill was approved and Gov. Greg Abbott signed it into law, tweeting at the time: “California may be the golden state, but Texans deserve to keep their gold in-state!” Not a bad line, but the talk of “repatriating” Texas-owned gold ignited inevitable speculation that this was all part of a secession plan.
“Texas sets up a rival to Fort Knox to hold gold bullion,” said a Los Angeles Times headline. “Is secession next on the agenda?”
Maybe. Maybe not. We’re not telling, though I seem to hear more secession talk out in California than in Texas these days. And I haven’t heard much talk about calling our new Texas Bullion Depository the Fort Knox of Texas. At least I hadn’t until Wednesday.
“The Fort Knox of Texas,” it says on the new texasbulliondepository.gov website that assures us Lone Star Tangible Assets’ “team of experts” for the depository project includes “veterans of the precious metals industry, a former director of the United States Mint, veterans of the United States Air Force charged with operating our military’s nuclear weapons facilities and a former SWAT team leader.”
Sounds like just the kind of folks you want protecting your gold and preparing for your state’s secession.
The plan is for the new facility to be ready by December 2018. But we must note this is complicated and the selection process ran a few months longer than anticipated. So let’s get a pool going on which will be done first: The Texas Bullion Depository, the MoPac project or our new downtown Austin library.
I told Capriglione I was disappointed that he was not here for the Wednesday announcement and that there were no gold samples.
“I’ll be there at the grand opening in January,” he replied via Twitter. “I’ll bring some gold for all in attendance.:)”
Maybe what we really need is a Texas Bull—— Depository.