BOISE — Legislation to allow the Idaho treasurer to invest in gold and silver that must be physically stored in Idaho headed to the full House on Tuesday.
The House State Affairs Committee approved the legislation that Republican Rep. Ron Nate said is a great way to protect against inflation.
“With new concerns about financial instability, it makes sense for investors, and it makes sense for states, to turn to real assets, especially in terms of precious metals, to protect investments of their funds,” he told the committee.
Opponents said that precious metals as an investment are volatile, and there are much better investments to protect against inflation. The opponents also said it will cost money to get the gold and silver to Idaho and then have ongoing costs to store it in a safe place.
“My clients always want to have gold,” said Republican Rep. Rod Furniss in arguing against the legislation. “They like it because they’re in love with it or they have a political reason that they like it. There are a lot of things you could have that are better than gold.”
He also questioned the fiscal note accompanying the bill that typically spells out the state’s cost if lawmakers approve a proposed law. The fiscal note on Nate’s bill said there was not a fiscal cost. But Furniss said there would be transaction fees involved in buying gold and silver, costs involved in shipping it, and additional costs in storing it somewhere safe.
“It does have costs,” Furniss said.
Republican Rep. Julianne Young noted she wasn’t a financial expert, but that the proposed law only allowed the state treasurer the option of considering purchasing gold and silver as an investment.
“This is not mandating anything. This is simply giving those who have expertise the opportunity to weigh the facts and make a decision,” she said.
Democratic Rep. John Gannon noted he could support the bill because it didn’t force the treasurer to take any action, and there would be competition for storing the gold if any was bought.
Idaho State Treasurer Julie Ellsworth, in a statement to The Associated Press, said if investing in gold and silver were made available, that option would likely be evaluated by the treasurer’s investment advisory board, which she chairs.
“I would ask our office’s Director of Investments to discuss with the Board and evaluate how this may fit within the State’s investment policies and strategy,” she said.
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