Detroit Institute of Arts No objection To Chapter 9 Bankruptcy

The Detroit Institute of Arts (DIA), steward of a priceless art collection that has been threatened by recent statements by the City of Detroit’s Emergency Manager and creditors, announced today that it will not file an objection to the City’s eligibility for relief under chapter 9 of the Bankruptcy Code. The deadline for objections is today. The DIA cited several reasons for its decision.
The DIA recognizes the City’s severe financial distress and its need for the protection and powers of the bankruptcy court to help in the Emergency Manager’s efforts to rebuild and revitalize Detroit. As it has previously stated, the DIA applauds the Emergency Manager’s efforts, wishes him success and continues to encourage him not to undercut those goals by jeopardizing Detroit’s most important cultural institution and the economic, educational and other significant benefits it brings to the city and the region.
“We support Kevyn Orr’s goal of rebuilding the City through strengthening of the City’s institutions and governance,” said Eugene A. Gargaro, chairman of the DIA board of directors. “We know the museum plays a critical role in anchoring the Midtown neighborhood and the City’s burgeoning arts community, and we stand ready to leverage that role in the rebirth of Detroit. In addition, the DIA is recognized as an important asset of the entire region, as was demonstrated last August when voters in Wayne, Oakland and Macomb counties approved a nationally acclaimed regional millage to support museum operations.”
The DIA reiterated that it has not been involved in any pre-bankruptcy negotiations with the Emergency Manager, one of the bankruptcy eligibility issues identified by the court. The DIA also noted the court’s limited powers in a chapter 9 municipal bankruptcy case, which focus primarily on the adjustment of the City’s debts, not the rationalization of its property, which is the sole responsibility of the Emergency Manager, who remains subject to Michigan law. Michigan Attorney General Bill Schuette has ruled that Michigan law prohibits the sale of the DIA’s collection to pay the City’s creditors.
Finally, the bankruptcy and Detroit’s financial distress should not affect the museum. The museum and the collection are held by Detroit in a trust for the benefit of all of the people of Michigan. They are not City property that can be sold or monetized and should not be involved in the City’s efforts to reach agreement with its creditors. Museum operations are completely independent of the City budget and no City funds are involved in the operation of the museum. Repeated statements that “everything is on the table” and the Emergency Manager’s retention of Christie’s auction house to appraise the DIA collection further complicate and confuse an already complex proceeding.
DIA Director, Graham W.J. Beal, said, “We remain committed to our position that the Detroit Institute of Arts and the City of Detroit hold the DIA’s collection in trust for the public, and we stand by our charge to preserve and protect the cultural heritage of all Michigan residents.”
The Detroit Institute of Arts (DIA), one of the premier art museums in the United States, is home to more than 60,000 works that comprise a multicultural survey of human creativity from ancient times through the 21st century. From the first Van Gogh painting to enter a U.S. museum (Self-Portrait, 1887), to Diego Rivera’s world-renowned Detroit Industry murals (1932–33), the DIA’s collection is known for its quality, range, and depth. The DIA’s mission is to create opportunities for all visitors to find personal meaning in art. Programs are made possible with support from residents of Wayne, Oakland and Macomb counties.

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