DETROIT Jan 29 The Detroit Institute of Art
(DIA) said on Wednesday its board of directors approved a
commitment to raise $100 million to help protect its art
collection and city retirees in Detroit's bankruptcy.
Added to the total already pledged by U.S. philanthropic
foundations and by Michigan's Republican Governor Rick Snyder,
some $820 million has now been committed to city pensioners and
"We are hopeful this agreement will allow Detroit's
bankruptcy to move forward smoothly as we all work toward a
brighter and better future for Detroit," DIA board chairman
Eugene A. Gargaro said in a statement.
The city's emergency manager has been looking at assets the
city could use to meet some of the pension fund liabilities and
thus avoid making steep cuts to retiree benefits. The aim of the
fundraising is to help avoid those cuts and keep the artwork in
the museum's hands.
The museum statement added that as part of a deal to raise
$100 million from corporate and individual donors, the city of
Detroit would transfer "free and clear legal title to the museum
building, the art collection and all related assets."
The DIA would continue operate with donor funds and taxes
raised from Detroit's suburbs.
On Tuesday the W.K. Kellogg Foundation committed $40
million, bringing the total pledged by foundations to $370
million. Governor Snyder unveiled a plan last week to tap up to
$350 million in state funds over 20 years for Detroit retirees.
Kevyn Orr, Detroit's state-appointed emergency manager who
took the city to U.S. Bankruptcy Court in July, has opened the
door to monetizing city-owned works at the institute, which have
been appraised at as much as $867 million. That could include
selling the artwork or using it as collateral for loans.
Orr has also eyed severe cuts in the city workers'
retirement benefits. Detroit's two pension funds are the city's
biggest unsecured creditors and Orr has pegged the unfunded
pension liability at $3.5 billion.
Overall, Detroit faces some $18 billion in long-term debt.