Another tough day for an Omaha non-profit tied up in the Vinny Palermo scandal at Omaha City Hall.

While Palermo, a former city councilman who has pleaded guilty to taking kickbacks and more, sits in jail awaiting sentencing City Hall today trotted out a new, hopefully scandal-proof plan going forward.

[View our full video report above]

City Clerk: “Number 9.”

A lottery at Omaha City Hall. A first of its kind lottery and here’s why.

For years fireworks in Omaha have been sold by a handful of big dealers but only after contracting with a non-profit which had the city permit needed to make those sales. But those days are over because former Omaha City Councilman Vinny Palermo was gaming the system.

January, 2023

Joe Jordan, NCN: “Mr. Palermo, can I ask you a few questions?”

Palermo refusing to talk publicly until he pleaded guilty and now faces up to 21 months in prison for one count of federal wire fraud.

August, 2023

Federal Judge Cheryl Zwart: “You were also a member of a committee that awarded fireworks permits to nonprofits in the city of Omaha, correct?”

Vinny Palermo: “Yes, your honor.”

Judge Zwart: “Did you also work along with or know Johnny Palermo and Richard Gonzalez?”

Palermo: “Yes, your honor.”

Judge Zwart: “Did you along with those two defendants come up with a plan where you would assist in having fireworks permits provided to PACE?”

Palermo: “I would say, yes.”

Palermo the first of four defendants in the case to admit to what the judge called a scheme, helping two of the three others, former Omaha police officers Rich Gonzalez and Johnny Palermo get their hands on fireworks permits for PACE a non-profit aimed at keeping inner city kids in sports and out of trouble.

Randy Paragas, Palermo’s Attorney: “The government was alleging, and Mr. Palermo has pleaded to, that there was some type of agreement that he would vote in favor of the benefits to those organizations in exchange for trips and that sort of thing.”

With Palermo and three others accused of misusing PACE money in a wide-ranging public corruption case, plenty of PACE contributions were put on hold.

As NCN first reported, for 2023 the city initially budgeted $100,000 for PACE, then Palermo pushed and got another $26,000 added in.

Palermo (Sept 13, 2022): “For me it always goes back to the kids.”

But when the investigation hit Mayor Jean Stothert shut the money down, suspending that $126,000.

And then there was the city’s distribution of federal COVID cash, ARPA money.

All told PACE was in for $360,000, half in 2022, half in 2023.

PACE received the $180,000 for 2022, but that remaining $180,000 was suspended.

Mayor Jean Stothert: “Money was being taken from this organization and what it was being spent on was pretty disturbing to me.”

Joe Jordan, NCN: "Did it ever come to your thoughts, this is a potentially corrupt system?”

City Councilwoman Aimee Melton, Omaha (R): “I've been complaining about this for a long time. Wasn't alleging that any council member ever engaged in the corruption, but I said it's ripe for it.”

City Clerk: "Last Number."

Enter the new lottery system, urged by Councilmember Melton, which finds each council member and the mayor submitting the names of 10 non-profits, 80 in all but only 40 get picked.

PACE was one of those 80.

But during today’s bingo like drawing, PACE’s number was never called, and for the first time in years won’t have a permit to sell fireworks next July 4th, the latest fall-out in a city hall scandal that finds Palermo’s January sentencing bringing a likely 21 months in prison plus a still undetermined amount of restitution.