The Grass quarter of the city, mentioned in the article, is also problematic. As always with projects like this, nobody in the city is asked. By virtue of owning the land, having connections to the city council, or being an art figure (or all three) you unilaterally get to decide how a plot of land in the center of this small town is used. The city government thinks it is a great idea, but really only the small portion of the city's educated and well-off will tend to visit the museum and the exibitions. Again, this is all quite detached. It's the same impetus that lets cities put up hideous art and monuments in common places without ever asking the residents (also quite a problem IMHO in Göttingen but also elsewhere).
(Not to mention that some people say Günther Grass never properly processed his past in the SA and was quite anisemitic in his old days... I think that's rather tangential, but Steidl is the kind of person who is seen as on the moral "high ground" and from whom such scandals tend to pearl of.)