Oklahoma’s current budget

Governor Kevin Stitt released his FY 2026 budget proposal and gave the state of state address in February 2024. The FY 2026 budget was enacted in May 2025.

Oklahoma enacted its FY 2025 budget in June 2024. The budget reports $12.5 billion in general fund spending, a decrease of one percent over the previously enacted budget. (The NASBO data cited below is a different measure of general expenditures.) Oklahoma passed individual income tax cuts in 2025 and eliminated its state sales tax on groceries in calendar year 2024. These followed significant tax cuts in both 2023 and 2022.

Under the American Rescue Plan, Oklahoma received $1.9 billion in direct state fiscal aid and $1.1 billion in local government aid from the federal government. As of January 2025, Oklahoma had fully allocated its state ARP. States must spend the funds by Dec. 31, 2026.

According to the National Association of State Budget Officers (NASBO), Oklahoma’s total expenditures in fiscal year FY 2025 were $29.3 billion, including general funds, other state funds, bonds, and federal funds. NASBO reported that total expenditures across all states in FY 2025 were $2.9 trillion, ranging from $5.4 billion in Wyoming to $413.8 billion in California.

According to NASBO, Oklahoma’s recent expenditure totals (general fund spending/total spending, including federal transfers) were:

• FY 2025: $7.9 billion/$30.5 billion
• FY 2024: $9.1 billion/$27.9 billion
• FY 2023: $7.8 billion/$29.1 billion
• FY 2022: $7.5 billion/$26.9 billion
• FY 2021: $7.0 billion/$23.8 billion
• FY 2020: $6.5 billion/$24.8 billion
• FY 2019: $6.2 billion/$23.8 billion

For more on Oklahoma’s budget, see

• the Oklahoma Office of Management & Enterprise Services,
  
• Oklahoma Open Books, and
  
• the Oklahoma Tax Commission.

Oklahoma’s budget institutions, rules, and constraints

Oklahoma uses an annual budget. The legislature must pass a balanced budget, but it can carry a deficit over into the following year. Oklahoma further limits both spending and revenue growth with binding budget rules, thus requiring a legislative supermajority or vote of the people to override them. A three-fourths supermajority or vote of the people is also required for any bill that raises revenue. The state limits total authorized debt and debt service incurred by the state.

(Note: Some states have informal budget institutions that constrain overall spending growth or a specific expenditure’s growth.)

Overview of Oklahoma’s state and local expenditure and revenue sources

Each state allocates spending and taxes differently among different levels of governments, and local governments often administer programs with state funds, so combined state and local government data show a more complete picture of individual benefits and contributions when comparing states.

Per the US Census Bureau, Oklahoma’s combined state and local direct general expenditures were $37.2 billion in FY 2022 (the most recent year census data were available), or $9,264 per capita. (Census data exclude “business-like” activities such as utilities and transfers between state and local governments.) National per capita direct general expenditures were $12,083.

Oklahoma’s largest spending areas per capita were public welfare ($2,310) and elementary and secondary education ($1,901). The Census Bureau includes most Medicaid spending in public welfare but also allocates some of it to public hospitals. Per capita spending is useful for state comparisons but is an incomplete metric because it doesn’t provide any information about a state’s demographics, policy decisions, administrative procedures, or residents’ choices.

Oklahoma’s combined state and local general revenues were $45.7 billion in FY 2022, or $11,376 per capita. National per capita general revenues were $13,619. Oklahoma uses all major state and local taxes. After federal transfers, Oklahoma’s largest sources of per capita revenue were general sales taxes ($1,601) and charges ($1,601), such as state university tuition and highway tolls.

Oklahoma’s economic trends

Oklahoma’s per capita income (per the Bureau of Economic Analysis) was $62,661 in 2024, ranking 40th among the states. It was below both the national average of $72,425 and the Southwest regional average of $63,623. The state’s median household income (five-year estimate) was $65,039 in 2024, ranking 43rd among the states and below the national average of $80,734. Oklahoma’s poverty rate was 15.3 percent in 2024 (five-year estimate), above the national rate of 12.5 percent.

Although Oklahoma’s averages tell a story about the entire state, Oklahoma is composed of diverse localities. For example, the city of Stillwater’s median household income was $43,700, and its poverty rate was 27.4 percent; the city of Jenks’s median household income was $111,004, and its poverty rate was 6.8 percent.

Oklahoma’s unemployment rate has historically been below the national average, particularly following the Great Recession.

Unemployment rates (like other economic indicators) often vary significantly by race and ethnicity. In Oklahoma, the average unemployment rate in 2024 was 3.4 percent for white residents, 3.4 percent for Black residents, and 3.8 percent for Hispanic or Latino residents.

The major industries that contributed the most to Oklahoma’s gross domestic product (GDP) in 2024 were government, finance, professional services, social services (i.e. health and education), and mining. Government and mining contributed more to Oklahoma’s GDP than they did to the nation’s and region’s GDP, while finance and professional services were less important to Oklahoma than they were to the nation and region in 2024.

Looking at more specific industries, among those that accounted for at least 1 percent of Oklahoma’s GDP in 2023, oil and gas extraction produced far more for the state than for the nation, contributing 8.4 percent to Oklahoma’s GDP and 0.9 percent to the nation’s. Other industries that overperformed in Oklahoma relative to national averages in 2023 were state and local government, pipeline transportation, mining support, and the federal government.

Oklahoma’s politics

Governor Kevin Stitt, a Republican, was elected in 2022 with 56 percent of the vote. The next gubernatorial election is in 2026.

Republicans control both the House of Representatives (81 Republicans to 20 Democrats) and Senate (39 Republicans to 8 Democrats), with veto-proof majorities in both houses. Control of the governor’s mansion and each house of the legislature gives Republicans a trifecta in Oklahoma. All Oklahoma House seats are on the ballot in 2026 because representatives serve two-year terms. Senators serve four-year terms; roughly half the senatorial seats are on the ballot in 2026, and the other half will be up for election in 2028.

Oklahoma’s demographics

As of July 2024, Oklahoma’s population was 4,095,393. That was up 8.9 percent from 2010. The state’s population growth rate was slower than than the nation’s 9.9 percent growth over the same period. The Urban Institute estimates the state’s population will increase 16.7 percent between 2010 and 2030, more than the nation’s estimated growth rate of 16 percent.

Additional resources

• The State and Local Finance Initiative’s Backgrounders explain the tax and spending issues highlighted in these briefs.
  
• The State Economic Monitor presents updated data and customized visualizations of state economic indicators.
  
• State and Local Finance Data: Exploring the Census of Governments allow users to sort, customize, and download the Census of Governments State and Local Finance series data featured in these summaries.
  
• The State Tax and Economic Review series provides quarterly reports on state tax collections and underlying economic trends in all 50 states.
  
• The Urban Institute’s State Tax Data Subscriptions provide access to up-to-date revenue data in all 50 states.