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==History== In 1879, the Panama Cemetery Association was formed and raised funds to dig a well.<ref name=":0">{{Cite web|url=http://lancaster.ne.gov/panama/history.aspx|title=Panama, NE - Historical Background|website=lancaster.ne.gov|access-date=March 21, 2018}}</ref> Panama was originally founded one mile south of its present location but was moved in order to be closer to the railway.<ref name=":0" /> In 1888, the village was officially founded on land that was previously owned by Moses J. Mitton, John Forrest, and Gilbert F. Steeves.<ref name=":0" /> According to local folk history, the village's original by-laws contained a clause inserted by a descendant of Gilbert F. Steeves, Caroline "Carrie" Steeves, which stated that if the village allowed any business to sell alcohol in the village, the Steeves family would reclaim the land they had deeded to the village.<ref name=":0" /> Panama was incorporated as a village in 1904.<ref>{{cite web | url=http://www.casde.unl.edu/history/counties/lancaster/panama/ | title=Panama, Lancaster County | publisher=University of Nebraska | work=Center for Advanced Land Management Information Technologies | accessdate=August 19, 2014}}</ref> New by-laws and ordinances were enacted when the village was incorporated and again in 1977, but it is still illegal to sell alcohol in the village.<ref name=":0" /> The village was likely named after the [[Isthmus of Panama]], which had gained notoriety at the time due to the [[History of the Panama Canal|United States' involvement in building the Panama Canal]].<ref name=":0" />
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