Texas Comptroller Glenn Hegar Announces Operator of Newly Created Texas Bullion Depository
(AUSTIN) — Texas Comptroller Glenn Hegar announced today the selection of Lone Star Tangible Assets (LSTA) as the vendor that will partner with the Comptroller’s office to build and operate the Texas Bullion Depository — the nation’s first state-administered gold bullion depository.
“This has been a lengthy process, and I appreciate everyone’s patience,” Hegar said. “We’ve been working diligently for nearly two years through a myriad of issues to ensure this partnership is successful. Lone Star Tangible Assets has been exceptionally responsive to the challenges posed by this endeavor and the problems raised in our request for proposals (RFP), and they bring to the table the solutions we need to make the Texas Bullion Depository a reality.”
The announcement concludes a lengthy evaluation period in which the agency assessed proposals from bidders responding to an RFP released last summer. The news follows the announcement that Tom Smelker, the director of Treasury Operations at the Comptroller’s office, has been named as the administrator of the depository.
“Lone Star Tangible Assets brings the right combination of experience, financial stability, and infrastructure necessary to make this depository a success,” Smelker said. “LSTA had a comprehensive vision for a safe and secure vaulting facility located right here in the Austin area, and they addressed a lot of concerns we had relating to everything from transportation and security to customer service and IT infrastructure.”
LSTA representatives at today’s announcement provided more detail regarding existing facilities as well as next steps in the process. LSTA is a Texas-based company and has been in the business of buying and selling precious metals since 2008. Their current vault facility is a highest-rated, Class 3 vault and will serve as the initial location for the depository as the company works to build a new vault facility for the Texas Bullion Depository.
LSTA Chairman Matthew Ferris detailed the timeline envisioned in the company’s business plan, noting the announcement allows LSTA to begin refitting the current vault immediately. Also, LSTA will start building IT systems, creating marketing materials and implementing other logistical elements needed before the current facility can begin receiving gold.
“Lone Star Tangible Assets is honored and proud for the incredible opportunity and their selection,” Ferris said. “We have already developed a fantastic collaborative relationship with the Comptroller’s office, and we look forward to working with Comptroller Hegar and his staff as we make history together.”
The Comptroller’s office will provide oversight of the project during the build-out of the depository and will continue monitoring when the operation goes live. The Comptroller’s Criminal Investigation Division (CID) has already performed inspections of existing facilities and physical security measures, while the Information Technology and Information Security divisions examined proposed software and digital security systems.
“They were very thorough,” Ferris said. “But I think everyone involved in this process wants it to be done right rather than done fast. When you are asking people to trust you with their real treasure, you need to make sure you’ve done your homework.”
While the depository will be in the Austin area, the Comptroller’s office and LSTA envision a network of licensed and insured Depository Agents around the state through which Texans can access depository services. An old timeline establishes a goal of having the existing vault ready in January 2018. LSTA expects the brand new, purpose-built repository facility to be completed by December 2018.
Hegar also detailed a creative solution for large commercial or institutional accounts that require significant liquidity. LSTA proposes to work with a primary banking partner to provide the liquidity needed for more major investors to use the Austin depository facility.
“This is a great moment in the history of our state,” Hegar said. “The Texas Bullion Depository will be yet another example of why Texas is the greatest state in the nation and a leader when it comes to economic innovations. People will be able to sleep at night knowing the state of Texas is protecting their gold.”
For more information, please visit TexasBullionDepository.Gov.
A live stream of this morning’s event is available in the Texas House of Representatives’ website.