A compromise proposed by the emergency manager of Detroit City Kevyn Orr — in order to save the permanent collections of the Detroit Institute of Arts (DIA) — has been accepted by the State.
Civilian, police and fire department retirees voted in favour of the “Grand Bargain” proposal, which would minimise pension cuts to 4.5% — down from the initially proposed 27% — and avoid a total restructuring. $816 million has been provided by the State and DIA Museum — promising the city’s financial stability. “The voting shows strong support for the city’s plan to adjust its debts and […] put Detroit on secure financial footing,” said Orr in a statement.
The plan still awaits approval by judge Steven Rhodes. If his decision is favourable then the museum will not have to sell its collection and the city’s finances should be secure by October.
However, Detroit’s financial creditors view the compromise as illegal, as it does not offer satisfaction to all creditors, particularly favouring pensioners. They accuse the “Grand Bargain” of undervaluing the DIA collection — recently valued at $4.6 billion — in order to save the artworks.