A group of Detroit's largest creditors filed a motion in federal court on Tuesday that could lead to the sale of at least some of the bankrupt city's multi-billion dollar art collection, held at the Detroit Institute of Arts. The motion comes months after Detroit Emergency Manager Kevyn Orr asked Christie's Auction House to appraise the DIA collection, infuriating Detroit-area residents and the art community at large. At the time, Orr said that "there has never been, nor is there now, any plan to sell art."
Detroit filed for bankruptcy in July, with $18.5 billion in debt. The DIA collection has been previously valued at about $2.5 billion, but that's not an exact figure. Some individual paintings in the collection, such as DIA's works by Van Gogh, Matisse, and Bruegel, could be worth about $50 to $100 million each.
As the Detroit Free Press first reported, the motion filed on Tuesday by a handful of bond insurers, three European banks, and the largest union in the city asks for the formation of a committee, appointed by Judge Steven Rhodes, in order to determine the collection's market value, apparently independent of the Christie's valuation initiated by Orr. It's the first legal step taken in the city's bankruptcy case that puts the collection at risk of sale. Free Press has more on what's at stake here:
The filing suggests major creditors are unlikely to agree to any restructuring plan if they believe Detroit emergency manager Kevyn Orr is offering a low-ball figure for the value of the art. The move increases the chances that Rhodes will ultimately be forced to decide whether the art can legally be sold.
The paper spoke to an executive at Financial Guaranty Insurance Co., the bond insurer that led the draft filing process. He spoke of the sale of at least some of the city's collection as a necessity, claiming that "there will be a viable DIA that will survive this process and possibly even thrive." He added, "there needs to be a construct that addresses the fact that the DIA, or art, is not an essential asset and especially not one that is essential to the delivery of services in the city." DIA has previously argued that any sale of art will put the museum's future in jeopardy. The city's creditors, for what its worth, don't have the power to force the city to sell anything. However, Judge Rhodes could end up throwing out any deal proposed by the city that he believes hides some of the its assets.