How the Racial Bias in the Muni-Bond Market Might Cost Black Colleges

The video discusses the racial discrimination faced by historically black colleges and universities (HBCUs) in the municipal bond market. HBCUs pay 14% more to issue muni bonds compared to non-black schools due to investor reluctance and higher bank fees. This financial burden is significant as many HBCU students are on financial aid, and these institutions have smaller endowments. Despite awareness, legislative efforts to address this issue have stalled, leaving banks and colleges to negotiate solutions. The ongoing discrimination highlights broader systemic issues in America.

What is the primary reason historically black colleges and universities face higher costs in issuing municipal bonds?

• Lack of financial aid for students

• Racial discrimination in the investor market

• Higher tuition fees

• Increased operational costs

How much more, on average, do black colleges pay to issue municipal bonds compared to non-traditionally black schools?

• 14% more

• 5% more

• 10% more

• 20% more

What percentage of HBCU students are on financial aid, contributing to the financial strain on these institutions?

• 80%

• 75%

• 60%

• 50%

What additional financial burden do HBCUs face when trying to provide resources similar to other colleges?

• Both higher scholarship costs and smaller endowments

• Smaller endowments

• Larger student populations

• Higher scholarship costs

What has been the response of the legal infrastructure in the US to the issue of racial discrimination in the muni market?

• Immediate action to resolve the problem

• Effective legislation has been passed

• Some legislation has been proposed but not enacted

• Complete ignorance of the issue