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ne Year Late

"Grand Bargain" saved DIA's treasures to the relief of staff, volunteers, citizens.

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Diego Rivera's breathtaking murals are among the art treasures at the world-renowned Detroit Institute of Arts. Detroit's bankruptcy put the collection's fate in question.

Barbara Lewis I Contributing Writer

I t started with a doodle on the back of a
legal pad.
Chief Judge Gerald Rosen of
the U.S. District Court for Eastern
Michigan had been appointed the chief
federal mediator to oversee Detroit's bank-
ruptcy proceedings. Soon after Detroit
declared bankruptcy on July 18, 2013, the
city's then-emergency manager, Kevyn
Orr, announced that the city-owned collec-
tion at the Detroit Institute of Arts would
be considered a city asset that could be
sold to settle the city's debts.
Civic outrage was fast and furious as
local residents worried that one of the
city's jewels might be tarnished or lost.
Later that summer, while meeting with
some of the museum's trustees, Rosen
wrote the word "art" with a box around it
on the back of his legal pad. Then he drew
an arrow from the box to the word "pen-
sions:' Eventually his scribbling resulted

in an unprecedented arrangement that
brought state, private and foundation
money to pension funds in exchange for
protecting the artwork from sale.
Rosen's idea became known as the
"Grand Bargain:' a plan that not only pro-
tected the DIA and its collection, but also
reduced cuts to city pensions.
Under the Grand Bargain, a consortium
of foundations, corporations, unions and
the state of Michigan provided funds to
Detroit's two pension systems, and own-
ership of DIA pieces transferred to the
Founders Society, the nonprofit that was
already operating the museum. The DIA,
in turn, pledged to raise $100 million to
safeguard the pensions.
Michigan Gov. Rick Snyder described
Rosen's proposal as "a turning point" in
the bankruptcy proceedings.
The Grand Bargain was sealed on Dec.
10, 2014, when Detroit officially emerged
from bankruptcy
The Detroit Jewish News recently talked
with a number of people involved
with the DIA to see how they felt
when the museum was threatened
and how they feel now, a year later.

THE MEDIATORS:
GERALD ROSEN AND
EUGENE DRIKER

Key players: Judge Gerald Rosen and Eugene Driker.

Rosen has described the Detroit
bankruptcy mediation as the
most challenging and personally
gratifying mediation of the many

he's done. Part of what confronted him as
he prepared to lead the city's negotiations
with creditors was how little the city had
to offer.
"I was very, very distressed to see once
I got into it, how few assets there really
were Rosen told WDET.
Still, the mediation was a major factor
that helped all sides to agree and find a
way out of bankruptcy.
Rosen asked Eugene Driker, a founding
partner of the Detroit law firm Barris, Sott,
Denn & Driker, to join him and five other
judges on the mediation team.
"I called him and told him, 'I have an
offer you can't refuse:" Rosen told Crain's
Detroit Business, adding that Driker was
"an all-star" on the mediation team.
Driker, 79, and his wife, Elaine, have
been members of the DIA for more
than 50 years, and Elaine served on the
museum's board for 12 years. They are also
active with the local Jewish community.
Driker worked on the issue of the city
pensions, trying to figure out a way to sat-
isfy Emergency Manager Orr, who wanted
the pensions cut to pay off creditors, while
at the same time preventing disaster for
Detroit retirees, many of whom needed
their monthly checks to survive.
"The city had no assets that could be
converted into cash except for the art at
the DIA," Driker said. "The mediators were
interested in finding the cash, but we were
also interested in the future of the city.
We knew that after emerging from bank-

ruptcy the city would have to be viable,
and we felt that selling the art would be a
death blow:'
Soon after conceiving of the Grand
Bargain idea, Rosen reached out to the
leaders of major charitable foundations for
support. On Nov. 5, 2013, the mediators
met with representatives from many of the
country's major foundations, including
the Kresge Foundation, the W.K. Kellogg
Foundation, the John S. and James L.
Knight Foundation and the William
Davidson Foundation. They created a
new "supporting organization" called the
Foundation for Detroit's Future to serve as
the mechanism for converting the funds.
The Ford Foundation set the bar by
pledging $125 million to the Grand
Bargain, Driker said, leading the way to a
total of $366 million from the foundations.
But the foundations demanded that the
state of Michigan contribute funds as well,
so Driker and Rosen started lobbying the
governor and legislators. It was an election
year, so that wasn't easy.
The state agreed to support the Grand
Bargain — but only if the DIA raised $100
million from its friends and support-
ers. When the DIA sought the funds, the
donors "stepped to the plate Driker said.
The judge's original doodle has been
given to the DIA, but public relations
director Pamela Marcil says the museum
has no plans to publicly exhibit it.
On Nov. 19, Rosen and now-retired
Bankruptcy Judge Steven Rhodes, who

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10 December 10 2015

