The Municipal Development Corp. in Wakayama Prefecture has been spending millions of yen in lottery proceeds to send local mayors on luxurious overseas sightseeing trips since 1998, according to officials of a quasi-public company.

Internal documents obtained Sunday by Kyodo News show that 7 million yen was spent on a nine-day tour to North America in fiscal 2003, or about 800,000 yen for each participant. It included stays at luxury hotels and visits to tourist spots like Niagara Falls, the Statue of Liberty and the Empire State Building in New York.

Three town and village mayors, four town and village assembly chairmen and two members of the development corporation joined the tour last November.

About 40 percent of lottery proceeds are allocated to local governments to be spent on public works and other purposes.