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Balneário Camboriú, a well-known beach resort in the Santa Catarina province of Brazil, has officially legalized the operation of its public lottery corporation. The action, which is embedded in Municipal Law No. 5.062, was signed into legislation this week by Mayor Juliana Pavan.
The effort is part of a growing tendency among Brazilian cities to obtain new revenues beyond classic taxes as a way to finance priority works in strategic areas such as urban mobility, social inclusion, and sports.
Increasing Sources of Revenues for Local Development
With the law signed into practice, Balneário Camboriú will now be able to conduct lottery modalities sanctioned by federal law. The aim is to cultivate an additional, stable source of income to finance specific municipal coffers without placing a new fiscal burden on residents.
As the Secretary of Finance in the city, Magda Bez explains that the idea is to create an open and solid system where lottery-based revenue is funneled into six designated municipal coffers. Of these, a minimum of 50% of the net earnings will go to the Urban Collective Transport and Mobility Fund (FUMTUM). The balance will be distributed between the Fund for the Protection of People with Disabilities (FMPD), the South Region Development Fund (FUMDERES), the Municipal Anti-Drug Council (COMAD), the Senior Citizens Fund (FMI), and the Sports Fund (FUNDESPORTE).
“This is a novel source which does not offend the city budget“, Bez said. “It’s a smart way of identifying alternatives for the city without billing the taxpayer.”
Operational Structure and Oversight
The law provides for flexibility in operating the service. The city is either going to own and operate the lottery or the city is going to provide concessions, permits, or third-party authorizations. Under both models of operation, the Secretary of Finance would oversee the management of the service as well as the release of the money earned.
Specific regulations and working procedures shall be laid down later by a municipal ordinance, as per national legislation and principles of governmental transparency.
The creation of the public lottery is also bound to encourage greater public trust in municipal finances, as the revenues shall be devoted to specific, pre-determined uses.
Chapecó: Another Santa Catarina Municipality Adopting Lottery Model
Balneário Camboriú is not alone in this move. Last June, Chapecó city, in the state of Santa Catarina, sanctioned its municipal lottery bill. Sanctioned by Mayor João Rodrigues and sanctioned by the City Council, Chapecó’s bill also authorizes the municipal government to directly run the lottery or delegate its administration through concessions.
In Chapecó, the allocation of lottery funds is highly concentrated: 70% will go toward autism individuals and policies and services for them, with the remaining 30% going toward reducing the municipality’s deficit in its social security scheme (Regime Próprio de Previdência Social).
A Growing Trend in Brazilian Municipal Finance
The introduction of municipal lotteries in Chapecó and Balneário Camboriú is part of a broader trend towards more decentralized local governments in Brazil. While federal laws provide legal authorization, more and more municipalities are embracing lotteries as a fiscal innovation tool. The benefits extend beyond simple revenue raising; lotteries can help to supply committed sources of funds for high-leverage social and infrastructure initiatives, so cities can cut back on reliance on broader state or federal transfers.
By linking the profits to specific municipal needs, cities expect to create public support and accountability. While careful control and regulation will be required to implement, the trend toward city lotteries is well established and promises to have other cities follow suit shortly.
For Camboriú, the new public lottery will be a way of financing strategic works while making sure that the city is committed to open and responsible financial management. Once the service turns from a bill to a real operation, its success will likely be measured by the real enhancements in mobility, inclusion, and community happiness that citizens will be able to experience in the coming years.
Source: iGaming Brasil
