Now that a coalition of national and regional foundations is prepared to commit as much as $330 million to bolster underfunded pensions for city retirees and to shield city-owned pieces in the Detroit Institute of Arts from liquidation, Daniel Howes raises an important question in his Detroit News column: Is any contribution coming from Michigan taxpayers?
Now it’s the state of Michigan’s turn, Howes writes.
The unprecedented effort, considered crucial to speeding the city’s exit from Chapter 9 bankruptcy, hinges on whether federal mediators can persuade the state of Michigan and DIA donors to also contribute to a fund expected to total at least $500 million, a foundation executive close to the process told The Detroit News.
“There are a lot of pieces up in the air,” the foundation executive said Monday, calling the complicated pension-DIA negotiation “the linchpin to settle the entire bankruptcy. $500 million is a floor, actually. The most difficult piece is probably at the state level.”
For months, Gov. Rick Snyder and state officials have downplayed suggestions that taxpayer money would be pledged to finance Detroit’s exit from municipal bankruptcy. In recent weeks, as mediation talks intensified, the governor has signaled that a state role could be possible if it would close an otherwise difficult deal.
Snyder's office remains noncommittal, says Howes, "citing the confidentiality of the mediation process and the political reality that any commitment of state funding or backing of bonds would be done in partnership with the Republican-controlled Legislature."
Bottom line: The situation remains fluid.
DIA artwork that accompanies this story on page one: "Bank of The Oise at Auvers," by Van Gogh
