Local Government Revenues
Oklahoma’s local governments collect a range of taxes, user charges and other revenue. These revenues allow Oklahomans to provide the funding needed to support a wide range of local services, ranging from schools to streets, water to hospitals. The chart below shows how the various local governments collect their revenue.
This section describes revenue patterns for Oklahoma’s local governments.
- Counties collected $1.8 billion in 2012. User charges ($583 million) are the largest source of county revenues, mostly from county hospitals. Intergovernmental revenue–mostly severance, fuel and other taxes shared by the state–are the next largest source ($459 million), Property taxes generate $445 million, but less than one out of five property tax dollars goes to counties. Sales taxes and miscellaneous revenues are also important to counties.
- Cities and towns (known collectively as municipalities) collected over $5.5 billion in 2012 revenues. More than half of all city revenues are user charges ($3.1 billion), including utility fees. Indeed, two-thirds of all local user charges are collected by cities. The largest sources of fees are hospitals, followed by water, electric, and sewerage charges. The sales tax is the second largest revenue source for Oklahoma cities, generating $1.8 billion.
- School districts relied on intergovernmental revenue for two-thirds of their $5.7 billion 2012 collections. This is a significant change from sixty years ago when property taxes made up most school revenue and there was no federal and little state funding for this service. Now state aid for education totals $3.7 billion. Federal aid helps a number of school districts as well. Property tax is the only other important school district revenue; two-thirds of all property taxes paid by Oklahomans go to their local schools ($1.6 billion).
- Special districts, which operate water, housing, hospital, emergency medical and other services, collect just four percent of all local revenue, approximately $580 million annually. User charges, mainly for rural water service, are the largest source. Intergovernmental revenue is the next largest source, mainly federal funding for local housing authorities. Some special districts collect small property taxes and some charge fees for housing and other services.