Committee advances bill letting state treasurer consider limited investments in precious metals and digital assets

The Ways and Means Committee voted to recommend passage of House Bill 302 on a 11–8 roll call after a work session that drew testimony from State Treasurer Monica Musappelli and multiple legislators.

HB302 would add precious metals and specified digital assets to the list of investments the state treasurer may consider, with a statutory cap that no more than 5% of total public funds may be invested in those asset classes.

State Treasurer Monica Musappelli told the committee she does not take a position on the bill and described practical constraints on deploying those assets. "Because it's not a requirement to invest in precious metals and digital assets, it doesn't create an immediate impact in the way we invest our funds," Musappelli said, adding that operating and rainy day funds require liquidity and low volatility.

Musappelli described trust funds the treasury holds that are managed for long-term capital appreciation and said those funds — rather than short-term operating cash — would be the only likely candidates for any limited allocation. "Those will be the only type of funds that could potentially utilize an option like this…if this type of assets will allow for that," she said.

Legislators pressed for details about existing practice. Musappelli said the treasury currently centralizes about 40 trust-type accounts (managed in fewer pooled portfolios) totaling roughly $60,000,000 and that the office contracts with an investment adviser on a five-year agreement; the adviser meets quarterly to review performance and manages day-to-day decisions within the law and the portfolio investment policy.

Sponsors and supporters framed the bill as permissive and conservative in scope. Representative Amond, the bill sponsor, said similar measures have recently passed in Oklahoma and the Texas Senate and were headed to a governor's desk in Arizona. He said the bill aims to provide additional portfolio tools to hedge inflation and that the proposal includes safeguards such as a market-cap threshold for allowed digital assets.

Supporters noted guardrails in the draft: a 5% maximum allocation limit and a market-capitalization threshold (the sponsor cited a half‑trillion-dollar threshold that at the time would have limited eligible cryptocurrencies to Bitcoin). Opponents and some members questioned the need for statutory language because, in discussion, Musappelli indicated some long-term trust funds and mutual funds already could include commodities or funds holding digital assets under current law and the investment adviser’s discretion.

Committee members debated whether the bill merely codifies existing authority or sends a stronger policy signal prompting the treasurer or advisers to act. Representative Southworth and others argued the investor already has discretion; Representative Eulary and supporters said placing the allowance in statute provides clarity and guardrails for trustees and advisers.

The committee approved the motion to recommend passage (OTP) in executive session. The roll call recorded 11 votes in favor and 8 opposed; the committee chair announced the motion passed with one member absent.

If enacted, HB302 would be permissive: it would not compel purchases, would limit direct treasury exposure to a small percentage of public funds, and would rely on the treasury’s existing use of outside investment advisers and policy documents to determine if — and when — such purchases are appropriate.

Questions remain about specifics that the treasurer and members said they would provide later, including a detailed breakdown of current allocations to non‑government-backed ("risk") assets across all state accounts and further clarification about which specific funds the 5% limit would apply to. The treasurer said she would follow up with more detailed figures after the meeting.

Votes at a glance: In executive session on March 10 (work session date not specified in the transcript), Representative Eulary moved and Representative Murphy seconded the motion to recommend HB302 (ought to pass). The committee clerk recorded a roll-call vote; the motion passed 11–8.

The committee asked that minority and majority reports be filed on a short timetable before the next meeting.