The Detroit Free Press reported Thursday:
Detroit emergency manager Kevyn Orr is considering whether the multibillion-dollar collection at the Detroit Institute of Arts should be considered city assets that potentially could be sold to cover about $15 billion in debt.
How much is the art at the DIA worth? Nobody knows exactly, but several billion dollars might well be a low estimate.
DIA Executive Vice President Annmarie Erickson said the museum has hired New York bankruptcy attorney Richard Levin of Cravath, Swaine & Moore to advise ways to protect the collection from possible losses. Levin is one of the nation’s leading bankruptcy attorneys and was active in the General Motors bankruptcy and other high-profile cases.
“We are standing by our contention and belief that we hold the collection in trust for the public,” Erickson said this evening. “And although to some it may seem to be an asset, we do not.”
Bill Nowling, a spokesman for Orr, said the art collection at the DIA must, however reluctantly, be considered one of the city’s assets in the current financial emergency as the city heads toward a possible bankruptcy filing.
Michigan Gov. Rick Snyder at the end of February announced plans to send an emergency manager “to repair the deeply troubled finances of Detroit, one of the largest cities ever to reach such a dire point or to face such a level of oversight,” The New York Times reported on March 1.
On March 25, Orr, “a Washington bankruptcy lawyer, officially took office…amid a flurry of protests from residents opposed to his appointment,” the Times reported that same day. Orr’s salary: $275,000, paid mostly by the state.
The Free Press points out:
Liquidating DIA art to pay down debt likely would be a monstrously complicated, controversial and contentious process never before tested on such a large scale and with no certain outcome. The DIA is unusual among major civic museums in that the city retains ownership of the building and collection while daily operations, including fund-raising, are overseen by a nonprofit institution.
The storm-cloudy situation seems stage-setting for nasty, and perhaps lengthy, litigation. That could mean court-ordered halts to the emergency manager’s sales efforts, bad blood between City Hall, the state, and the cultural community, and plenty of money for lawyers involved while the city and DIA continue to struggle with debt.