The Governor of the Federal District, Celina Leão (PP), filed an action directly with the Supreme Court (STF) to halt a projected R$ 1.8 billion reduction in the Federal District Constitutional Fund (FCDF) for 2027, according to court documents cited by local coverage. Filed by the Federal District Attorney’s Office (PGDF), the Direct Action of Unconstitutionality (ADI) challenges Article 14 of Complementary Law No. 235/2026.
The newly enacted legislation establishes a fiscal rule that may restrict the annual growth of FCDF transfers during years when the central government projects a primary fiscal deficit, as reported in the official reports on revenues and primary expenditures (RARDP). According to the text presented to the Supreme Court, the local executive branch is seeking an urgent preliminary injunction to suspend the enforcement of the norm.
Legal Arguments and the Projected R$ 1.8 Billion Impact
The contested R$ 1.8 billion figure was calculated by the Senate’s Independent Fiscal Institution (IFI) and reflects only the estimated impact of the first of two restrictive mechanisms created by the legislation, according to the PGDF petition. The legal filing highlights that this amount does not represent the full potential loss, because a secondary mechanism simultaneously reduces the base used to update the fund.
The lawsuit contends that Article 14 is unconstitutional on formal grounds, arguing that the restriction was introduced via a parliamentary substitute and approved outside the budgetary legislative process reserved for the executive branch, as detailed by the PGDF. Furthermore, the petition notes that the measure advanced without the specific budgetary and financial impact estimate required during the legislative process.
According to that coverage, compressing these mandatory allocations shifts essential federal service costs directly onto the treasury of the Federal District without proper financial compensation.
Did You Know? The annual financial updates of the Federal District Constitutional Fund are directly tied to the performance and variation of the federal government’s Net Current Revenue (RCL), according to the foundational rules established under Federal Law No. 10.633/2002.
The Mechanics of the Contested ‘Double Trap’
The legal challenge defines the legislative change as a “double trap” that affects the fund from two directions simultaneously. Under the first mechanism, if the federal government projects a primary deficit, the growth of certain expenditures linked to the fund is capped at the limit set by the federal fiscal regime rather than following its expected evolution. Under the second mechanism, revenues related to the commercialization of oil and natural gas are removed entirely from the calculation used for obligations indexed to the Net Current Revenue (RCL).
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Because the fund’s updates depend on variations in the federal RCL, the PGDF argues that the combined rules artificially restrict resource inflows while shrinking the baseline calculation. In a public statement published via social media video, Governor Celina Leão criticized the legislative maneuver. According to her statements, the primary text submitted by the executive branch originally addressed petroleum, but a provision regarding constitutional funds was inserted during debate. She stated that this marks the third time the federal government has attempted alterations to the fund, warning that the current measures would severely hinder public security, education, and health services in Brasília.
Expert Insight: Fiscal disputes between subnational entities and the central government frequently turn on budgetary competencies and formal legislative procedures. When economic adjustments intersect with mandatory funding streams dedicated to public safety and payrolls, legal challenges in constitutional courts often focus heavily on whether legislative amendments bypassed executive-reserved budgetary initiative rules.
Frequently Asked Questions
What legal action did the Federal District government take?
The Government of the Federal District filed a Direct Action of Unconstitutionality (ADI) in the Supreme Court (STF) alongside a request for a preliminary injunction to suspend Article 14 of Complementary Law No. 235/2026, according to official court filings.
How much is the fund projected to lose under the new law?
According to estimates by the Senate’s Independent Fiscal Institution (IFI) cited in the petition, the first restrictive mechanism alone accounts for a projected reduction of at least R$ 1.8 billion for the 2027 budget.
Which public sectors could be affected by the funding restrictions?
The local executive branch states that the reduction could compromise the financing of payrolls, operational costs, and investments across the Civil Police, Penal Police, Military Police, Fire Department, and the public health and education networks.
How will these potential budget adjustments alter public service delivery across the capital in the coming years?
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