Opinion ID: 481732
Heading Depth: 3
Heading Rank: 2

Heading: Oil Production Tax.

Text: 77 Over half of the local tax dollars distributed to schools are collected under the state oil production tax. Of the $2.6 million of local taxes distributed to the county schools, $1.7 million is from the oil tax. No revenues from this tax are generated from oil production within the city limits of Brewton. Plaintiffs' Exhibit A at 2. Nevertheless, the defendants attempt to claim some of that money for the city. Their argument is that city residents may own some of the oil, and thus city money is used to pay the tax. 11 78 This argument, however, ignores the simple fact that the Alabama oil tax is assessed at the mouth of the well, Ala.Code Sec. 40-20-1(1) (1975), and at the time of severance, id. Sec. 40-20-3(a). In fact, the tax is to be paid by the person in charge of the production operations prior to making payments to the ultimate owners of the oil. Id. Thus, I would conclude that this is county money, and therefore this money cannot be said to flow from the city to the county. 12 79