MEMPHIS, Tenn. - It’s called the ‘Black tax,’ when banks charge areas with more Black residents, like Memphis and Shelby County, more to borrow money than they charge areas with more White residents.

Research revealed cities with more Black residents are forced to pay more to fix roads, bridges, and schools – things that everyone uses.

Cummings K-8 has been closed since August, when the ceiling of its library caved in, sending three people to the hospital.

LaRose opened its doors to families.

Memphis-Shelby County Schools is still unable to say when Cummings will re-open its doors. Like Cummings, about 40% of the district’s schools are at least 60 years old; there are nearly a half-billion dollars in deferred maintenance costs, according to the district, problems that the district doesn’t have money to fix.

Dr. Matthew Wynter, a professor of practice finance at Stony Brook University, said it could be called structural racism.

Wynter is one of three researchers who found that Black tax.

When governments want to fix water or road issues, and even build new schools, they ask banks for a loan called a municipal bond.

Areas with more Black residents pay more even when “credit risk” is factored in, according to the study.

It means many places with majority Black populations are charged more to borrow the same amount of money as governments with majority white populations.

"These tend to be counties that are larger, that have higher income per capita, that have more employment,” Dr. Wynter said.

Shelby County Mayor Lee Harris recently announced plans to build a new, $80-million high school in Frayser. The project will likely be funded with municipal bonds, and because of its bond rating, Shelby County will pay more to borrow that money than Collierville would.

The mostly white town of Collierville opened a massive $100 million high school a few years ago, at the time the largest in the state. It will soon undergo an $8-million upgrade.

“You have schools with peeling walls and paint that’s coming off and so many issues,” said Shelby County Commissioner Charlie Caswell, who has advocated for school funding Frayser for years.

We reached out to five of the biggest banks underwriting bonds, the service agencies that assign bond ratings, and the agency that regulates it all, the SEC.

JP Morgan Chase, the SEC and Morgan Stanley declined comment.

On Tuesday morning, a spokesperson for Citibank said the bank also declined to comment. 

“Our education system is being affected because we’re not able to get the higher ratings … when we, as a county, are showing, and have shown, that we have been strong in carrying our budget,” said Caswell.

After hearing Mayor Harris outline his upcoming budget to county commissioners, we set out to get his thoughts. After initial reluctance, he agreed to talk with FOX13 News as he rode the elevator back to his office.

“I don’t know if local government has the ability to make Wall Street firms charge a particular interest rate,” Harris said.

A spokesman for Rep. Steve Cohen, D-Memphis, said he’d return a call but never did.

In the state’s largest school district, where 100,000 students go to class in many outdated buildings, the “to do” list continues to grow.