ELY, Minn. (AP) _ The library where a painting had been displayed with little notice for 50 years and local artists will benefit from the $506,000 this small town made by selling the art work.

City Council decided Tuesday to invest the money and use the interest for library improvements and the arts.

Earlier this month, the council accepted a $510,000 bid for Frederick C. Frieseke's impressionist painting, ''Breakfast in the Garden,'' which depicts two women and an infant at a garden table.

No one is certain how the painting got to this northeast Minnesota town of 4,800. Interest in the picture was rekindled recently when a city council member and the city clerk-treasurer began talking about it.

The painting was taken to a Duluth museum for appraisal, then sold to a New York gallery. Ely netted $506,000 after transportation costs to the gallery.