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Committee advances Bayou Gold certification and treasurer gold-investment proposal amid consumer‑protection and cost questions
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Summary
Lawmakers moved forward two related measures: HB797 (a voluntary "Bayou Gold" certification for private gold custodians) and HB610 (authorizing the state treasurer to invest up to 10% of available stabilization funds in physical gold). Supporters cited hedging value and consumer demand; opponents warned a state seal could mislead consumers and that safekeeping and transaction costs are material. HB610 passed on a 10–5 recorded vote.
Two related measures about the state’s engagement with physical gold drew extended committee debate on April 21, as the Appropriations Committee advanced a voluntary vendor‑certification program (HB797, “Bayou Gold”) and authorized a separate bill (HB610) to let the state treasurer invest up to 10% of available monies in the Revenue Stabilization Trust Fund in physical gold.
Representative Raymond Cruz, sponsor of HB797, described the proposal as a non‑regulatory, voluntary seal that would let vendors apply for a Bayou Gold designation if they meet insurance, segregation and storage standards (the bill as amended references London Bullion Market Association/COMEX standards). Cruz said the certification is intended to reassure constituents who want physical custody options “so I can go get it physically if I want it.”
Opponents warned the state could unintentionally confer a marketing advantage. JP Cortez, executive director of the Sound Money Defense League, testified in strong opposition, saying, "This bill would create a state sanctioned program that allows a small group of private vendors to market their gold as if endorsed by the state of Louisiana, granting them a government backed competitive advantage." Cortez argued the proposal could create consumer confusion and give a small group of vendors a de facto seal without the state assuming liability.
Committee members and sponsors discussed amendments to tighten technical standards and require Treasury recertifications every two years. Representative Cruz said multiple vendors are welcome to apply and that the program is intended to create market competition on consumer protections.
HB610 (treasurer investment authority) drew detailed technical testimony from Amy Matthews, CIO in the State Treasurer’s Office, about transaction fees, insurance and safekeeping. Matthews said custodial and insurance arrangements (including Lloyd’s of London for coverage) and audit practices create specialized costs and operational tasks the treasury would need to staff and manage. She estimated that buying and selling a large holding could create a bid‑ask spread and transaction costs measured in percentage points and that safekeeping and personnel costs are nontrivial.
Representative Crews and other supporters cited Utah and other precedents and described the investment as a long‑term hedge against currency depreciation. Treasury staff said a separate funded vehicle (rather than the revenue stabilization fund) might be more appropriate to preserve liquidity ratings and avoid market‑access complications.
The committee adopted technical and definitional amendments to HB797 and moved it forward. On HB610, Representative Tarver moved the bill out of committee; the committee held a recorded roll call and the motion passed 10 yeas to 5 nays.
What happens next: HB797 was reported favorable as amended; HB610 was advanced on a recorded vote (10–5) and will proceed to the next stage in the legislative process.
Provenance: committee discussion, witness testimony from JP Cortez (opposition) and Amy Matthews (Treasury) and sponsor commentary (Representative Cruz, Representative Crews).
