Detroit Hit With a $4 Billion Proposal for City's Art
- August 27, 2014 23:02
New York-based Art Capital Group has offered Detroit a loan of up to $4 billion in a new proposal that leaves the city's museum intact with its art used as collateral. The amount is about 10 times what the city's planned 'grand bargain' deal has generated from donors.
Detroit is going to court on Tuesday to try to push the grand bargain through. The deal keeps city-owned art at the Detroit Institute of Arts, but under a new foundation owner. Retirees would then be paid part of their pensions from the bankrupt city through the grand bargain donations from the state and others. Those in opposition to the plan include other creditors, primarily the city's bond insurers, who won't recoup much from the grand bargain and want the city's art sold or "monetized."
This week, a term sheet with details of the Art Capital plan was provided to the New York Times. The document gives a vastly greater total appraisal figure for the DIA's collections: $8.1 billion. A previous appraisal by Artvest Partners put the value of the 60,000-+ piece collection at $2.6 billion to $4.6 billion, with a liquidation estimate of $850 million.
Detroit is sticking with the grand bargain. About the $4 billion loan, Bill Nowling, a spokesman for Detroit Emergency Manager Kevyn Orr, said to ClickonDetroit: "This is an attempt -- nothing more -- from our creditors to get more money from them, to improve their recovery at the expense of retirees and at the expense of selling the treasured assets of the city."
