The Fate of Detroit’s Art | Via and Via
Detroit doesn’t have much these days, but it does have its masterpieces.
Now, one of the city’s biggest creditors says the city needs to sell its art collection — likely Detroit’s most prized asset — in order to pay off its debts in bankruptcy court. And they’ve found several investors who are willing to pay top dollar.
Financial Guaranty Insurance Co. (FGIC) is asking Detroit’s bankruptcy judge to force the city to negotiate with private investors, some foreign, who have made tentative offers to purchase city-owned treasures from the Detroit Institute of Arts (DIA).
The offers, which include a $2 billion loan for the art, could tempt Judge Stephen Rhodes, who has previously called one-time influxes of cash “unsustainable.”
The City of Detroit has at least $18 billion in debt, and pensions for retired city workers are underfunded by at least $3.5 billion. As Emergency Manager Kevyn Orr grapples with creating a plan to exit bankruptcy court that will satisfy all debtors, a fierce public debate rages over the fate of the DIA’s collection.
Orr has negotiated a deal, dubbed “The Grand Bargain,” which would transfer the city’s art holdings to a separate nonprofit in exchange for $816 million pooled from state funds, the DIA’s own money and donations from foundations. That $816 million would be applied to offset pension cuts for retirees, and the art would be kept in the public trust.
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