(Salt Lake City, Utah) – Utah Governor Spencer Cox signed legislation on Thursday empowering the state Treasurer to secure state funds with a significant allocation to physical gold and silver. Sponsored by Rep. Ken Ivory, House Bill 348 permits the Treasurer to hold up to 10% of certain state reserve accounts in precious metals to help secure state assets against the risks of inflation and financial turmoil and/or to achieve capital gains as measured in Federal Reserve Notes.
The Utah State Treasurer has limited options for holding, managing, and investing state monies, making this enabling legislation necessary.
Utah’s reserves are invested almost exclusively in treasuries, municipal bonds, corporate bonds, and agency debt.
These debt instruments carry risks – especially because they are not inflation-hedged and are therefore largely unprotected from the steady erosion in the real value of principal, coupled with interest rates that are often negative in real terms.
The legislation specifically pertains to the State Disaster Recovery Restricted Account, General Fund Budget Reserve Account, Income Tax Fund Budget Reserve Account, and the Medicaid Growth Reduction and Budget Stabilization Account.
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