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STATE OF OKLAHOMA
2nd Session of the 60th Legislature (2026)
SENATE BILL 1494 By: Paxton
AS INTRODUCED
An Act relating to school district employees;
amending 70 O.S. 2021, Section 26-104, as amended by
Section 2, Chapter 245, O.S.L. 2024 (70 O.S. Supp.
2025, Section 26-104), which relates to the flexible
benefit allowance for school district employees;
requiring appropriation of adequate funding to the
State Board of Education for flexible benefit
allowances for employees of certain school districts;
requiring appropriation of adequate funding to the
Board for certain flexible benefit allowances for
employees of certain school districts; clarifying
disbursement of certain funds; updating statutory
language; updating statutory references; providing an
effective date; and declaring an emergency.
BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
SECTION 1. AMENDATORY 70 O.S. 2021, Section 26-104, as
amended by Section 2, Chapter 245, O.S.L. 2024 (70 O.S. Supp. 2025,
Section 26-104), is amended to read as follows:
Section 26-104. A. 1. Each fiscal year, the Legislature shall
appropriate adequate funding to the State Board of Education and the
State Board of Career and Technology Education for the purpose of
providing a flexible benefit allowance to technology center school
district employees pursuant to this act section.
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2. Each fiscal year, the Legislature shall appropriate adequate
funding to the State Board of Education for the purpose of providing
full funding to support a flexible benefit allowance to school
district employees employed by school districts that provide in-
person classroom instruction for a minimum of one hundred seventy
(170) days or the equivalent number of hours, not including in-
person classroom instruction time used for professional development
or parent-teacher conferences.
3. Each fiscal year, the Legislature shall appropriate adequate
funding to the State Board of Education for the purpose of providing
a flexible benefit allowance that shall not be less than the Plan
Year 2026 benefit allowance amount to school district employees
employed by school districts that provide in-person classroom
instruction for fewer than one hundred seventy (170) days or the
equivalent number of hours, not including in-person classroom
instruction time used for professional development or parent-teacher
conferences.
4. Unless the Legislature appropriates adequate funding
specifically for the purpose of providing a flexible benefit
allowance to school district employees, the Oklahoma State Board of
Education shall allocate from the funds appropriated to the Oklahoma
State Board of Education for the support of public school activities
an amount to fully fund the flexible benefit allowance, which shall
occur first prior to allocating the funds for any other purpose.
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The amount appropriated for funding and disbursed to school
districts shall be calculated by multiplying the number of eligible
school district employees employed by school districts which are
participating in the health insurance plan offered by the Oklahoma
Employees Insurance and Benefits Board or are self-insured as
counted in February of each year by the amount of the flexible
benefit allowance credited to the eligible school employees as
established in Section 26-105 of this title.
Each 5. The State Board of Education and the State Board of
Career and Technology Education shall disburse the total amount
appropriated for funding the flexible benefit allowance to school
districts during the fiscal year. From the total amount
appropriated, each Board shall disburse the appropriate amounts,
based on the number of eligible school district employees employed
by that each school district or technology center school district,
to each school district.
B. Every school district shall establish or make available to
school district employees a cafeteria plan pursuant to 26 U.S.C.,
Section 125 of the United States Code. The plan shall offer, as a
benefit, major medical health care plan coverage.
C. The flexible benefit allowance amount established pursuant
to Section 26-105 of this title shall be credited to each eligible
school district employee. School district employees shall elect
whether to use the flexible benefit allowance to pay for coverage in
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the health insurance plan offered by the Oklahoma Employees
Insurance and Benefits Board or the self-insured plan offered by the
school district and may receive the excess flexible benefit
allowance as taxable compensation as provided in Section 26-105 of
this title.
D. The administrator of the cafeteria plan shall maintain a
separate account for each participating school district employee.
School districts shall forward the school district employee flexible
benefit allowance amounts to the administrator for elected purchases
of cafeteria plan benefits.
E. Expenses included in an employee’s salary adjustment
agreement pursuant to the cafeteria plan shall be limited to
expenses for:
1. Premiums for any health insurance, health maintenance
organization, life insurance, long term disability insurance, dental
insurance, or high deductible health benefit plan offered to
employees and their dependents; and
2. All other eligible benefit programs offered under 26 U.S.C.,
Section 125 of the United States Code.
F. The flexible benefit allowance amount established in Section
26-105 of this title shall not be included as income in computation
of state retirement contributions and benefits or as part of the
Minimum Salary Schedule minimum salary schedule for teachers
established in Section 18-114.12 18-114.15 of this title. School
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districts shall not consider the flexible benefit allowance amount
as income for eligible support employees and thereby shall not
reduce the salary of an eligible support employee.
SECTION 2. This act shall become effective July 1, 2026.
SECTION 3. It being immediately necessary for the preservation
of the public peace, health, or safety, an emergency is hereby
declared to exist, by reason whereof this act shall take effect and
be in full force from and after its passage and approval.
60-2-2227 EB 1/9/2026 1:21:05 PM