The city's Chapter 9 bankruptcy filing Thursday suggests municipal assets will have to be sold to help cover the city's $18 billion debt, and there is debate over whether the assets include the art, technically owned by the city, in the Institute's collection, CNN reported Friday.
Director Graham Beal told CNN in May the collection, in total, could be valued in the billions of dollars. It includes the original Howdy Doody used in the 1950s-era television program, which was purchased in 2001.
Puppet collector Gary Busk said, "It is estimated that the marionette could sell at auction for $400,000 to $500,000."
A directive in May by Detroit's emergency manager, Kevyn Orr, requesting an inventory of the Institute's holdings, caused concern the collection could be sold off to help pay the city's debt, but in June Michigan Attorney General Bill Scheutte issued an opinion stating the collection is held "in charitable trust for the people of Michigan, and no piece in the collection may thus be sold, conveyed or transferred to satisfy city debts of obligations."
Scheutte's comments may not hold much weight in court, said Eric Scorsone of Michigan State University, prior to the bankruptcy declaration.
"A state attorney general's opinion is certainly not going to be definitive in federal bankruptcy court," Scorsone said.
Laura Martell, a Wayne State university law professor, agreed, saying the opinion is "not binding on anyone and certainly has no legal effect in a bankruptcy case."
Bill Nowling, spokesman for Orr, said in an e-mail to CNN, "All of the city's creditors have asked about the Detroit Institute of Arts and whether it has been valued -- it has not -- and some creditors have said everything that isn't nailed down should be sold to pay them."
The Institute's 800-piece puppet collection also includes one of Muppet creator Jim Henson's Kermit the Frog puppets, CNN noted.