Less at the Pump, More for Oklahoma Students, Lower Tax Liability

A school bus may be an unexpected place to find a tax planning opportunity. In Oklahoma, it is also where an investment in local infrastructure can help stretch education dollars.

As school districts convert buses from diesel to compressed natural gas, or CNG, lowering emissions and fuel costs can leave more money available for teacher salaries, classroom materials, and student services. For CPAs, these projects offer a tangible way to connect conversations about Oklahoma tax liability with community needs.

Local districts demonstrate the potential.
Putnam City Schools report saving more than $100,000 annually after converting about two-thirds of its bus fleet to CNG. The district says it began testing CNG buses in 2025 and expanded through an Environmental Protection Agency grant secured with Green Energy Solutions, with no conversion cost to the district. News 9's coverage highlights the transportation initiative.

At Deer Creek Public Schools, a new fueling system offers another example. Oklahoma Business Voice reports that B&H Construction projects annual savings of $350,000 to $400,000 as the district expands its CNG use. The state's Clean-Burning Motor Vehicle program enabled B&H to provide the infrastructure at little to no cost to the district.

The Deer Creek installation allows buses to refuel overnight at the transportation hub. The same report identifies Cushing Public Schools as an earlier B&H school project, illustrating the technology's reach across the state.

These examples show what lower transportation expenses can mean locally: greater budget flexibility and more resources available for students.*

Private investment can help fund public benefits.
According to Oak Hills Securities Inc., the placement agent for the investment opportunity with the potential allocation of the Oklahoma CNG tax credit, the company has assisted nearly 100 Oklahoma school districts with CNG fleet conversions. Its work connects private investment with equipment projects that can reduce school transportation expenses, benefiting both the school district and the environment, a true public-private partnership.

The investment structure described in Oak Hills' CNG whitepaper involves companies that own conversion equipment and lease it to school districts (please note projects aren’t limited to school buses, as trucks and other vehicles for county governments and a few private enterprises have also been converted). The projects that works best consist of heavy fleets where the vehicles begin and end the day in the same location and can take advantage of a slow fill system to fuel the vehicles over a night or weekend. Eligible investors may receive allocated Oklahoma Clean Energy (CNG) tax credits, subject to the applicable rules and offering terms as discussed more fully in the offering documents.

For clients with substantial Oklahoma income tax liability, the potential benefit deserves careful evaluation. The Oklahoma Tax Commission's Form 567-A provides for credits on qualifying clean-burning vehicle equipment and recognizes that an entity may lease converted property while retaining the right to claim the credit.

CPAs can connect the numbers with the need.
Don Dillingham, a CPA and fellow OSCPA member, brings an accounting perspective to these conversations. CPAs reviewing an opportunity should examine eligibility, credit allocations, documentation, investment risks, and whether a client's tax liability and timing support using the credits.

The district stories make the broader purpose visible. Oklahoma's natural gas resources, private capital, and tax incentives can help schools manage a recurring expense (fuel cost) while supporting local infrastructure.

For an Oklahoma CPA, that creates a conversation with two dimensions: the client's financial position and the students who may benefit when fewer education dollars go toward fuel.

*Actual savings depend on fuel prices, fleet use, project costs, miles traveled, and other factors.

This article was sponsored and provided by Oak Hills Securities, Inc.