Education Agencies and Services

The largest state appropriation goes to the State Department of Education. It received more than one-third (39 percent) of appropriations in FY 2021. Of the agency’s total appropriation of $2.993 billion, 77 percent ($2.301 billion) takes the form of state aid funding that goes directly to local school districts. District allocations are determined by a formula that considers the number of students and various factors – including poverty, English-language learners, and transportation and special education services – that make educating some students more costly (See this blog post for more on the school funding formula). In addition to formula funding, the State Department of Education appropriation includes funding for “programs and activities” that is used for teacher and support staff health care coverage, retirement costs, textbooks, alternative education, advance placement education, early childhood education, and reading instruction.

At the local level, school districts spend state appropriations (43 percent of all school funding in FY 2019) along with property taxes and other local funding (42 percent), state tax revenues dedicated for education (5 percent), and federal funds (11 percent). Since 2014 the state share of all education costs has fallen from 62 to 47 percent, and the local share has risen from 29 to 42 percent. Federal funding increased from 10 to 11 percent in the same time period.

Higher Education is the third largest state agency by appropriation at $770 million in FY 2021, 3 percent below the prior year. Since 2009 higher education appropriations have fallen by 16 percent while overall state appropriations increased by 8 percent. The Constitution prohibits the Legislature from appropriating funds to specific campuses. The allocation among the 25 colleges and universities is made annually by the Regents for Higher Education from a lump sum appropriation by the Legislature and other revenue sources, mainly tuition and fees. The largest allocations for FY 2021 were: 

• University of Oklahoma (includes all campuses and OU Health Science Center)–$780 million;
• Oklahoma State University (includes all campuses and OSU Center for Health Sciences)–$731 million;
• University of Central Oklahoma–$174 million; and
• Northeastern State University – $87 million.

In addition to money allocated to institutions, a portion of higher education funding went to debt service payments ($40 million in FY 2021), financial aid programs ($121 million), and the endowed chair program ($11 million). Funding for the Oklahoma Promise scholarship program – $70 million in FY 2021 – is allocated directly to a dedicated fund.

State appropriations (27 percent) and tuition and fees (55 percent) funded most spending on Oklahoma campuses in FY 2021. From 2007 to 2021, the share of appropriated funds has decreased from 51 percent to 27 percent, while tuition and fees have grown from 36 percent to 55 percent of spending. Tuition and most other non-appropriated funds stay at the campus that collects them.

Career and Technical Education is the other large appropriated education agency. The $118 million FY 2021 appropriation helps provide courses for over 550,000 students at 58 technology centers and in almost 400 school districts. State appropriations in FY 2021 are 13 percent below what they were in FY 2009. About 82 percent of funding for technology centers comes through property taxes and other local sources.

Eight other education agencies received about $45 million in total appropriations for FY 2017. The largest are:

• The Oklahoma Center for the Advancement of Science and Technology (OCAST), which provides funding for research based on Oklahoma campuses ($14 million in FY 2021);
• The Commissioners of the Land Office, which manages lands held in trust for education purposes ($8 million); this agency distributed  $146 million in earnings from school lands to education agencies in 2019;
• The Physicians Manpower Training Commission (PMTC), which administers residency and scholarship programs to encourage establishing medical practices in rural and underserved areas ($7 million);
•  The Oklahoma School of Science and Mathematics, a high school that services students from across the state ($6 million);
• The State Department of Libraries, which operates state libraries and provides grants to local library systems ($4 million); and
• The Oklahoma Educational Television Authority (OETA), which operates television stations across the state, broadcasting Public Broadcasting Services and local programming ($3 million).

Most of the major education agencies receive appropriations. The largest also receive substantial funding from federal and revolving funds. However, a few important state education agencies operate without appropriations.

• The Oklahoma Lottery Commission operates the lottery authorized by voters in 2004. In FY 2020 this agency collected $268 million from ticket sales and other revenues. At least forty-five percent of collections (approximately $166 million in 2020) are reserved for prizes.  Remaining funds are used for the costs of running the lottery (approximately $36 million) and for various education uses (approximately $65 million). After 2017 and 2019 changes in how the lottery is distributed, sales were up 56 percent from 2015 to 2020 and the education funding increased 8 percent in the same period. Lottery proceeds cannot be used to substitute for other education spending.
• The Oklahoma Student Loan Authority issues bonds and loans the proceeds to eligible students in Oklahoma higher education institutions. In FY 2015 this agency spent $19 million.
• The Oklahoma College Savings Plan allows families to save for college education while avoiding some federal and state income taxes. Expenses of the plan manager and all other operations are paid from the investment earnings of the plan.

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