Detroit may be able to keep its priceless art collection after all. In what is being called a “grand bargain,” the bankruptcy judge is allowing foundations to purchase the art from the city, moving it to a public trust that would keep the art on the walls. The city would use some of the proceeds from the sale to fund pension payments for retirees. So far, $330 million has already been pledged from various foundations, but the art is valued at $866 million, and time is running out to seal the deal, as the WSJ reports:
Leading the pack among philanthropic groups is Ford, expected to commit $125 million to save the art, according to two people familiar with the matter. Other pledges include $100 million from the Kresge Foundation of Troy, Mich., a group that developed an urban renewal master plan for Detroit last year, according to a person familiar with the matter. The Miami-based John S. and James L. Knight Foundation has promised $30 million, the largest gift in the group’s history, while the Michigan-based William Davidson Foundation has pledged $25 million.But hurdles remain as the parties involved race to finish talks before the city completes a plan, expected as early as next week, to cut debt, pay off creditors and reinvest in crime- and blight-reduction efforts. In the past, [emergency manager Kevyn] Orr has said that all of the city’s assets, including its art collection, could be sold to pay creditors. Among philanthropic leaders’ outstanding concerns is a desire to protect a new regional tax that provides operating funds for the museum.
This deal may yet fall apart, but it’s heartening sign that the bankruptcy judge is doing his best to find a way through the disaster that serves both the residents and the creditors.It also shows that if politicians hadn’t been busy robbing the city blind and milking it for patronage, the city’s problems probably could have been dealt with outside of bankruptcy court. The disaster in Detroit was caused by bad governance, by the corrupt response of the city’s Democratic machine to a series of economic challenges brought on in large part by the intransigence of the UAW, with an assist from the mismanagement of the U.S. car industry. If the city had been proactive about addressing its problems years ago, it could have avoided relying on the extraordinary charity of foundations to save its art. At this point, however, this is probably as good as it’s going to get.