Oklahoma Education and You

Some Oklahoma legislators are floating the idea of eliminating property taxes.  Predictably, entities that rely heavily on those dollars for funding are opposing this.  School leaders are part of this group because they know those ad valorem dollars will have to be backfilled from somewhere, and currently, ad valorem tax levies are the only way many districts can maintain or replace facilities and buy buses. 

Many Oklahoma school districts have passed bond issues to purchase buses.  It’s a pretty common practice.  However, Oklahoma schools are not mandated to provide bus routes for students, even though almost all do.  The state provides limited funding for this, but it doesn’t come close to covering what schools actually spend on transportation. For example, in the 2024-25 school year, the state provided $37,774,572 in transportation aid while Oklahoma school districts spent $260,170,492 on student transportation.  Granted, not all of this expense was for bus routes, since field trips and transportation to school activities also fall into this category, but it’s still quite a gap. 

Ostensibly, Oklahoma’s funding formula is supposed to pay for what schools need to properly serve students, with transportation as a separate line item to cover transportation costs. The system doesn’t work this way, though.  Almost every school must supplement its transportation allocation with other revenues to cover transportation expenses. In the 2024-25 school year, the gap between what districts spent from their General Fund on Transportation and the state’s Transportation Funding ranged from 11% of total General Fund revenue to less than 1%.  Some schools even showed a surplus of Transportation Revenue.

Charter schools account for a good portion of districts showing this surplus, which raises an interesting point.  Transportation funding is tied to a figure called the Average Daily Haul. This number is comprised of the number of students living 1.5 miles or more from their school.  To my knowledge, no charter schools run bus routes.  Yet, they receive transportation dollars?  Why?  But, I digress.

Going back to the issue of eliminating ad valorem taxes, this would make the gap between state transportation funding and expenses even wider.  Schools would be forced to use General Fund revenues to buy buses.  These dollars would be diverted from the classroom.

In a previous blog, I gave some suggestions for equalizing facilities funding among districts.  Transportation expense is another area of school finance with equity issues.  The legislature could fix this by adjusting the formula used to allocate transportation dollars. 

I also presented a scenario in which elderly Oklahomans could receive property tax relief.   I have another, cheaper suggestion for how this could be done.  Why not give every Oklahoma taxpayer an income tax deduction for the ad valorem taxes they pay for schools?  This would provide property tax relief for all Oklahoma homeowners and make it easier for school districts to pass transportation and facility bonds.  One thing is for certain: if the legislature decides to eliminate property taxes in Oklahoma, there is no way that schools will be able to provide both transportation and instruction to students.