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Ever since an emergency management team was dispatched to Detroit to restructure its ailing finances, one major asset has been under threat: hundreds of masterpieces housed at the Detroit Institute of Arts (DIA).

On Tuesday, a federal bankruptcy judge ruled for Detroit to proceed with a Chapter 9 restructuring, which will be the largest ever for a US municipality. He added, however, that the proceeds from the art museum, which he mentioned by name, may not be enough to satisfy the $18.5 billion in underfunded liabilities that the city must rectify.

The city 鈥渕ust take extreme care that the [museum collection] asset is truly necessary in carrying out its mission,鈥� Judge Steven Rhodes said.

Creditors are resolute in saying the art is necessary to shore up cash because the collection, which includes at least 500 masterworks by Van Gogh, Rembrandt, and Matisse, is not vital to Detroit鈥檚 emergency services or the daily churn of city needs, such as lighting, sewers, and water.

Last week, a group of creditors filed a motion with Judge Rhodes asking him to appoint an independent committee to appraise the collection鈥檚 worth.

鈥淲e recognize that this is a very sensitive issue,鈥� Derek Donnelly, managing director of the Financial Guaranty Insurance Co., a creditor, told the Detroit Free Press last week. 鈥淏ut at the same time, there needs to be a construct that addresses the fact that the DIA, or art, is not an essential asset and especially not one that is essential to the delivery of services in the city.鈥�

The collection is already being appraised by Christie鈥檚 auction house in New York under the direction of Kevyn Orr, the emergency financial manager for Detroit. Creditors worry that the appraisal will come in too low. On Tuesday, Mr. Orr estimated that the most valuable pieces in the collection are worth less than $2 billion total 鈥� a figure that is four times less than what was estimated in media reports and among art insiders.

Christie鈥檚 is expected to release its appraisal as early as next week.

Douglas Bernstein, a bankruptcy attorney at Plunkett Cooney in Bloomfield Hills, Mich., says the motion filed by the creditor coalition is 鈥減remature鈥� because it has yet to see a plan from Orr鈥檚 team, which is expected in early January. 鈥淭hey have no idea what the city is going to offer. I really don鈥檛 think they are going to get much traction, at least at this point, with this request,鈥� Mr. Bernstein says.

Since his appointment in March by Michigan Gov. Rick Snyder (R), Orr has been relatively quiet about his plans for the DIA, which is considered to house one of the finest public art collections in the United States. However, he made his strongest statements on the matter Tuesday, telling the Free Press his team 鈥渨ill try to get some value from the art in some fashion.鈥� He added, 鈥淟et鈥檚 be clear. That鈥檚 a city asset.鈥�

Besides selling the art at auction, the city could monetize the collection by offering naming rights, lending pieces out for special use, and using certain pieces as collateral for loans.

Orr is suggesting that the DIA fight for its survival by immediately finding a way to monetize at least $500 million out of the collection, as a way to appease creditors during the mediation process. The museum is fighting that, saying it would actually threaten its existence by forcing valuable donors to flee and would jeopardize the tax millage it receives from a tri-county area.

鈥淭he DIA remains hopeful that [Orr] will recognize the City鈥檚 fiduciary duty to protect the museum art collection for future generations ...,鈥� the museum said in a statement released Tuesday. 鈥淚f the art is placed in jeopardy, the DIA remains committed to take action to preserve this cultural birthright for future generations.鈥�

On the museum鈥檚 side is an opinion issued in June by Michigan Attorney General Bill Schuette. The art collection, he said, is protected by the public trust and therefore is immune to public sale or lease.

The opinion will probably help the DIA in court should it decide to sue the state, Bernstein says, but it may not 鈥渘ecessarily have traction鈥� because Rhodes has the ultimate authority on the matter.

In his ruling Tuesday, Rhodes was cautious in suggesting that the DIA鈥檚 art would be enough to ultimately solve Detroit鈥檚 debt problems.

Bernstein says the judge 鈥渟hares the sentiment of everyone who is not a pensioner or a creditor鈥� 鈥� that over-reliance on DIA assets 鈥渨ouldn鈥檛 be anything more than a band-aid fix, and the city has had enough band-aids that haven鈥檛 worked.鈥�

鈥淥ne of the major challenges for the city is ... it needs to market its product. The city has to sell itself: We have to attract an increased tax base or an increase in tourism,鈥� he says. 鈥淎nd if you sell one of the things that brings people into the city, is the trade-off positive or negative?鈥�