Jessica McBride/Managing Editor
MCN contributes $8.5 million to state from gaming revenue in FY 2016
OKMULGEE, Okla. — The status of education in the U.S. and Oklahoma has been on the minds of many these days, especially when funding is mentioned.
Early last fall, media outlets began reporting an $878 million budget shortfall for the State of Oklahoma. The Oklahoma Department of Education felt the cuts early, and issued reductions throughout the 2016-2017 school year.
Oklahoma legislators approved $2.397 billion in appropriations and expenditures for the State Board of Education during a May 26 session. Oklahoma Gov. Mary Fallin signed the full state budget May 31.
According to the Oklahoma Education Coalition’s website, Oklahoma has the lowest per student funding as compared to surrounding states, and would need to invest approximately $1.275 billion more to meet their average funding.
ODE spokesperson Steffie Corcoran said Oklahoma ranks 47 in per student expenditures according to the National Center for Education Statistics.
By any metric, it’s hard to argue that we are appropriately funded for our student population,” she said.
Teacher salaries have also been at the forefront of education discussions. ODE’s website reports the average salary at $45,245. This is $2,858 below the regional average and $13,705 below the national average.
The minimum starting salary for an Oklahoma teacher is $31,600, and a new teacher with a doctorate can start at a minimum of $34,000. The website states the minimum salaries have not increased since 2008.
“One of the things Superintendent (Joy) Hofmeister talks about pretty consistently is that the state is in the middle of what is an ever escalating teacher shortage crisis, which is very much involved with the fact that we are not regionally competitive on teacher pay… she’s also very careful to say that that is not the only reason for our teacher shortage.
“Some of these school budgeting issues are responsible for some of it. A culture of overtesting that we’re turning around now has made some teachers discouraged. The feeling that they’re not appreciated and can’t make a difference in the classroom, all of those things affect it,” Cocoran said.
Public school funding in the state decreased over the last three school years, from $1.876 billion to $1.824 billion per ODE’s website.
“My perspective is that we’re underfunded. We’re 49th in the nation in our education services and performance. We are not doing enough to make sure that our students are well educated or they’re educated in acceptable facilities,” Muscogee (Creek) Nation Secretary of Education, Employment and Training Greg Anderson said.
However, not all numbers decreased.
In information shared by ODE with Mvskoke Media, Oklahoma issued 1,160 emergency teaching certificates for the 2016-2017 school year with two months in the year remaining. In 2011-2012, that number was 32.
The student population grew in the last three school years from 688,300 to 693,710. They stated the numbers are an increase of almost 50,000 students since the 2008-2009 school year.
“Funding has not kept up with the increase student growth across the state,” ODE Deputy Superintendent of Finance and Federal Programs Matt Holder said.
ODE declined to speculate why this is the case.
With 39 Native Nations in Oklahoma paying into the education funding pot through gaming revenue, tobacco taxes and other types of assistance, it can be difficult to understand why the state would encounter a funding gap for education.
Tribal funding impact
ODE is funded from a variety of sources: state funds, revolving funds such as certification fees and grants from private sources, and federal funds.
When you talk about education funding in the state, people refer to the 1017 fund, or the education reform revolving fund.
This account combines revenue from individual and corporate income taxes, sales taxes, use taxes, special license plate fees, tribal gaming revenue, horse track gaming, cigarette taxes, tobacco product taxes and business activity taxes.
However, funding calculations do not lump all of those taxes and fees into education.
According to the Oklahoma Office of Management and Enterprise Services, which is over finance and administration for the state, tribal gaming revenue does not entirely go to education.
Off of the top figure, $250,000 goes to the Oklahoma Department of Mental health and Substance Abuse Services. After that, the general revenue fund receives 12 percent and the 1017 fund for education receives 88 percent.
According to the 2016 Oklahoma Gaming Compact Report, MCN contributed $8.5 million in fiscal year 2016 in tribal gaming revenue to the state. This number is down from $10 million in FY 2012.
In FY 2016, Oklahoma received $132 million in gaming revenue from all tribes combined. This is up from $123.8 million in FY 2012.
Comparatively, tribal gaming revenue is a type of funding that adjoining states such as Arkansas and Texas do not see.
ODE also receives funding from tribes through tobacco sales.
According to the Oklahoma Tax Commission, $21.4 million was collected in tribal cigarette and tobacco payments and $65.5 million was collected in state and tribal compact stamps.
In the information provided, those funds are divided out to fund different health and hospital line items, but none state ODE specifically. A spokesperson for OTC stated it was possible for tobacco payment and stamp funds allocated to the general revenue fund went to fund ODE but could not clarify.
“Every one of those dollars that comes from gaming and tobacco sources is dollars that allows kids to use a new research tool or give a teacher some new skill perhaps. They’re filtering directly to the classroom and they are desperately, desperately needed and appreciated,” Corcoran said.
She said that revenue from tribes flows through the general revenue fund to the department, but that they do not have information to show where specifically those funds originate.
All of the public school monies then go through a funding formula to distribute to districts according to school characteristics such as population, socio-economic conditions of the area and student needs such as special education.
Corcoran said ODE has also seen increased numbers of students with disabilities and English learners. Since 2011-2012, the student population designated as English learners has grown 20 percent.
According to Mvskoke Media calculations, in 2016, the MCN National Council appropriated $38,300 to public schools for sports uniforms and other items that the schools’ budgets could not fund.
So far in 2017, the Council has appropriated $7,165.
“We’re doing everything that we can to help these public schools find ways to better serve the students in their districts. I don’t believe it’s up to the tribal Nations to field the financial gap that is created by the lack of state funding.
“I would support our Nation as we assist schools when they come forward with requests to assist with uniforms or other needs of these students. It’s really hard to say no to them. But I don’t think that any of the tribal Nations in Oklahoma should be obligated to fill the gaps in funding…” Anderson said.
Comparatively, the Cherokee Nation stated in a March press release that they gave $5 million to 107 school districts.
“I think that tribal entities across the state as a whole have been tremendous in supporting students. I do think that the schools are very dependent and becoming more dependent on those JOM (Johnson O’Malley) dollars and Title VII dollars that they get from the federal government in regards to their Native American students,” Holder said. “And I think as budgets get tighter… definitely more schools are going to rely on those funds coming in.”
The U.S. government authorized the Johnson-O’Malley Act of 1934 and Title VII under the U.S. Department of Education to provide funding for cultural and academic programs for American Indian and Alaska Native students in public schools.
These funds must be used within the guidance of the tribal Nations.
EET assists schools with this through the JOM Program. The department also provides assistance with higher education and technical training.
Opinions to the lack of revenue
In an editorial written by Union Public Schools Superintendent Kirt Hartzler and published by the ‘Tulsa World,’ the administrator calls out the state for the funding issues.
‘Shortsighted income and sales tax exemptions, oil and gas industry tax breaks, incentives and rebates… we are giving the farm away. Billions of dollars in lost revenue have seeped away into Oklahoma’s red dirt.
‘Oil, gas — and now wind energy — have netted trillions of dollars. In spite of an abundance of wealth generated from these natural resources, Oklahoma has precious little to show for it.
‘Frankly, it’s disingenuous to plead poverty; however, we continue to struggle with adequate funding for basic services and infrastructure for our citizens. We can’t say — with a clear conscience — that we have never had the money to address these issues. That is patently ridiculous.’
Anderson commented on increasing revenue.
I think the state can probably find other revenue streams that not only benefit Indian education, but education in general,” he said. “I would be supportive of an increase in the production tax. I feel that if we would’ve done this 10, 15, 20 years ago, we probably would not be in the situation that we are now.”
In another editorial published in the ‘Tulsa World’ by Tulsa Mayor G.T. Bynum, the mayor suggests that his hands are tied when it comes to helping solve the education-funding crisis.
‘Today, local communities can pass bricks-and-mortar education programs that renovate school buildings, build football stadiums, and supply classrooms with technology. But we are told the state funding formula for education punishes local communities if we pass anything to help fund the operations of our local schools.’
Anderson said there is more to the issue than the need for the state to generate more revenue.
“We have to be proactive in how we look at, how do we increase revenue? Once we get that, how do we spend those dollars,” he said. “We have to be, I think more transparent and accountable in what we do with that money…”
The journey forward
“I really don’t think you can put a price tag on a quality education for a child,” Anderson said. “I think in most cases you should fund the necessary amount to provide a quality education. Now, what is that amount? I don’t know.”
He suggested modeling a system after other successful states while taking into consideration geographical and other factors.
Holder said regardless of the funding, the state provides a quality education.
“First and foremost, I think everyone needs to realize regardless of all the funding issues, Oklahoma teachers and Oklahoma school districts across the state provide a very quality education to our students,” Holder said. “With more funding, it would allow them to broaden their horizons and broaden the scope that they are able to educate our students across Oklahoma.”
He said the state is also looking at other initiatives and areas to improve.
“Funding is not the only issue. We’ve got several initiatives going on here at the Department of Ed(ucation). Redefining our senior years, new individualized plan for students as they enter middle school and high school to get them college or career ready.
“There’s numerous things that we can get better at and improve upon as the economy and the landscape changes across the state of Oklahoma, I think we have to make our education system fit with those changes,” Holder said.
In April, MCN helped to organize a workshop on the Every Student Succeeds Act. Approximately 350 schools, organizations, ODE and the U.S. Bureau of Indian Education were present.
“It was just a wonderful event and it’s in no small part thanks to the leadership of your tribal Nation,” Corcoran said.
ESSA replaced the No Child Left Behind Act and requires school districts to consult with tribal Nations and organizations to create a plan for Indian education.
Holder said the event helped start the conversation.
“I think one of the things that this summit provided… is just opening up the communication lines with school districts and the tribal Nation, and I think that’s probably one of the most important things that can happen,” Holder said.
Anderson said MCN is consulting with the 34 schools in the MCN jurisdiction on how they are utilizing funds from the U.S. Department of Education and the Department of the Interior.
“We’re meeting independently with each school, getting to know how they operate these programs,” Anderson said.
He said this is important because all school districts are not the same.
“We also think it’s important that we create a relationship and get to know the schools and their Indian education directors, their superintendents,” Anderson said.
Through their consultations, MCN has found a great need for school funding.
He believes the consultations between MCN and these school districts should continue.
“This consultation should be ongoing… we want to open a line of communication that is continuous throughout the year,” Anderson said. “We want to attend events, we want to be involved in their activities. We want to partner with them as much as we possibly can.”
He believes ESSA grants the opportunity for accountability. Once the consultation process is complete, Anderson hopes to bring all of the public schools together to share information, best practices and recommendations.
Holder said the conversation created by the ESSA workshop is a step in the right direction.
“I think any time people are communicating it’s a positive thing,” Holder said. “I think whether you’re in business or education, whenever a communication line fails you usually have a systemic problem.”
Anderson said he would like to see the state and tribes work together similar to how tribes, the federal government and local education agencies work together to account for federal Native American education funds.
“I think there should be more transparency and accountability on how these monies are spent,” he said. “I would like to see a tribal consultation between the tribal Nations and the Oklahoma State Department of Education. A yearly consultation. The state needs to tell the tribes how much revenue is brought in, where that revenue is spent…”
Anderson would like to see this process implemented for all revenue tribes generate that is used by the state for education.
The budget passed by state legislators faces additional legal action. On June 13, R.J. Reynolds Tobacco Company and Phillip Morris USA filed a suit arguing the $1.50 cigarette fee imposed by the state to help generate revenue to bridge the gap in the state’s budget deficit is unconstitutional.