October 20, 2013 | Read Time: 5 minutes
The threat that the Detroit Institute of Arts could be forced to sell masterpieces to help pay the bankrupt city’s debts has overshadowed more upbeat news about arts in the Motor City.
Despite the city’s financial woes, Detroit’s cultural life is in many ways thriving—and some hope it is a harbinger of better days for the city.
“There is more energy and innovation going on in arts and culture than I have seen for the last 25 years,” says Maud Lyon, executive director of CultureSource, an association of Detroit-area arts nonprofits.
Major institutions like the art museum and the Detroit Symphony Orchestra have survived the recession and taken steps to bolster their financial health. The Detroit Science Center, which shut down in 2011, reopened last year as the Michigan Science Center after a Michigan businessman saved it from auction. The Museum of Contemporary Art Detroit, which just turned seven, “has established itself as an important center for new and edgy art, music, literature and film,” the Detroit Free Press wrote last month.
Grass-roots artists, including many who have moved to the city in recent years to take advantage of cheap real estate, are bringing creative energy to the city.
When the John S. and James L. Knight Foundation announced that it would award $2.1-million in “arts challenge” grants in Detroit this year, it received 1,400 applications, mostly from individual artists and small collectives—more per capita than in either of its previous contest sites, Miami and Philadelphia.
“I’m literally obsessed with Detroit,” says Dennis Scholl, vice president for arts at Knight, which last year sharply increased its giving to Detroit artists and museums, announcing more than $19-million in grants. “When we looked at Detroit, the momentum that was there that might give Detroit the opportunity to remake itself was coming from the cultural community.”
Auction-House Appraisal
But the news that Kevyn Orr, Detroit’s emergency manager, had asked Christie’s auction house to appraise a portion of the Detroit Institute of Arts’ 65,000-piece collection sent shock waves across the art world.
Both Mr. Orr and Christie’s have said they are not assessing the art to prepare it for sale, simply exploring ways that it might be used to raise revenue. The state attorney general has said it would be illegal to sell the art because it is held as a charitable trust for the people of Michigan.
But given the magnitude of Detroit’s estimated $18-billion debt, some of it owed to retired city workers who fear cuts in their city pension and health benefits, the museum’s supporters are not breathing easy.
The earmarked paintings, selected because they bear a credit line “purchased by the city of Detroit,” include Bruegel the Elder’s “The Wedding Party,” Van Gogh’s “Self-Portrait,” and Rembrandt’s “The Visitation.” Their sale would “effectively shut down the museum,” says Graham W.J. Beal, the institute’s director. That is because voters in three Detroit-area counties agreed last year to increase property taxes to provide about $23-million a year for 10 years to help the museum operate while building up its endowment—and officials in those counties have suggested they could revoke those agreements if art works are sold.
The city-owned museum is now urging state officials to pass legislation that would safeguard its art and working on language that it could apply to future gifts, telling donors that if their art work is sold, the proceeds could be used only to buy other art.
“It’s ironic,” Mr. Beal says of that plan, which would in effect restrict new gifts. “Forever hitherto we’ve wanted unrestricted gifts.”
The bankruptcy blow came as the museum’s fortunes were looking up. In addition to the new tax revenue—which Mr. Beal says gave the organization more financial security than it had enjoyed in 40 years—attendance has grown from 332,000 in 2010 to 594,000 this year.
The museum won $2.25-million of the Knight money that was announced last year and also gets major support from the Hudson-Webber Foundation, Kresge Foundation, and McGregor Fund. Foundations have helped arts groups weather a drop in corporate support, which represented 20 percent of giving in Detroit before the recession, much higher than the national average of 5 percent, Ms. Lyon says. Some, but not all of it, has returned, thanks partly to the improved fortune of Michigan-based automakers.
Of more than $625-million in foundation giving to Detroit from 2007 to 2011, almost a fifth, about $119-million, went to the arts, according to Foundation Center figures. Kresge has provided more than $15-million in operating support to more than 80 arts organizations in metropolitan Detroit since 2007.
No major art institution has gone under, though some have had to restructure to end up on firmer financial footing.
For example, the Detroit Symphony Orchestra, which survived a bitter six-month strike in 2011, has cut staff members, salaries, and benefits since 2009, and its conductor Leonard Slatkin agreed to a pay cut in his three-year 2010 contract. The organization, which has adopted a 10-year plan to increase revenues and boost its endowment, greatly improved its balance sheet last year by negotiating a deal with a five-bank lending consortium to retire $54-million in real estate debt.
Attendance is rising, too, thanks partly to concerts the orchestra is performing in neighborhoods throughout the city. Household subscriptions, which were tumbling after the recession, rose in 2013 to 4,051, higher than the pre-recession figure of 3,950 in 2007.
The orchestra announced this month that it had raised a record-breaking $18.9-million in its 2013 fundraising campaign, a 43 percent increase over last year, and was on track to erasing its operating deficit for the first time since the 2006-2007 season.
Anne Parsons, the orchestra’s president, says the arts are profiting from the urban-redevelopment projects that, with the help of foundation money, have revitalized the downtown area, the riverfront, and the Midtown area where the orchestra and art museum reside.
“We see new businesses coming in, new people coming in to live who are fun, diverse, sometimes a little edgy, all of the things that you look for in a thriving urban environment,” she says.
Ms. Parsons says she doesn’t want to dismiss “the reaction we hear all the time” that Detroit is in desperate straits.
But “we don’t agree with it,” she says. “It’s a little bit of old news.”
