WITH PORTLAND'S SEASON of outdoor festivals about to dawn, Mayor Sam Adams' office is taking serious steps toward taming one of the city's most notorious: Last Thursday.

The monthly arts gathering, which takes over a chunk of NE Alberta with vendor booths, entertainment, and general gaiety, has had a long, rocky history with neighbors and city officials. But according to organizers and recordings of semi-private "stakeholder" meetings obtained by the Mercury, that sometimes-fractious relationship could be reaching a breaking point.

Adams' office, looking to cut down on police costs and general chaos, is leading a heavy-handed push to permit the event and line up sponsors. But longtime Last Thursday leaders are convinced the city's changes will turn the freewheeling festival into a strict, corporate-sponsored affair that sells out the idea the event was founded on.

"Sponsorships are a slippery slope," says Rochelle Saliba, a former member of the nonprofit that runs the event, Friends of Last Thursday (FOLT). "Last Thursday isn't Last Thursday if there's money involved. The mayor thinks he's saving it, but he's really killing it."

Starting in January, Adams' staff began bringing FOLT and other community members to the mayor's warren of offices in city hall for a series of meetings on the future of the event. While the mayor's staffers say the get-togethers have been helpful—moving FOLT in the direction of a permit—recordings of those sessions obtained through a public records request reveal little agreement, and a lot of tension.

In a meeting in March, Adams shot down Saliba's request to refuse sponsors.

"I'm doing sponsorships and we are going to be fundraising on the streets. I can and I will," he said. "There is no other way to raise money. How much money do you have in the bank from last year? Zero."

To this, Saliba retorts: "You can't decide, Sam."

"I just did," Adams fired back. "If I have to be dictatorial about it, I will be. I am confident we'll be able to work through this. But it's time we all grow up."

Saliba quit FOLT shortly after the meeting, irked by Adams' power play and the direction the talks were taking.

For 15 years, Last Thursday has been an unpermitted version of an outdoor gallery walk, born in 1997, that soon grew into a monthly street party, leading to a landslide of neighbor complaints regarding noise, traffic, trash, and public urination. But for city officials, Last Thursday is just learning how to walk—two years ago, the mayor's office helped spark the creation of FOLT, in hopes that it could ultimately regulate and organize the untamed event.

The city, however, still doesn't think FOLT is ready to take the reins—with Adams particularly frustrated over organizers' steadfast refusal to push for local sponsorships or do fundraising. Earlier this year, the Portland Bureau of Transportation refused to give FOLT a permit for closing NE Alberta.

"This is a quintessential Portland event, important for local businesses and the community," Catherine Ciarlo, the mayor's transportation director, told the Mercury. "We don't want to change that. But it's crucial that the community meets its own goals first before Last Thursday gets a permit."

Last year, the city spent $10,000 a month to close off NE Alberta and provide security—and Adams tried to make it clear that the city council wouldn't help out this year. FOLT is split on how to finance Last Thursday. Sponsorships could pay for portable toilets, trash dispensers, and other necessary items—but they also could corrupt the free nature of the event.

Still, despite Adams' warnings, it seems the city will remain on the hook for security costs—at least this year. The first Last Thursday of 2012 is planned for Thursday, May 31, and officials say there are no plans to shut it down. Ciarlo now says the mayor's office is hoping Last Thursday will prove its stability this summer and then qualify for a permit by the end of the year.

Taming Last Thursday, and avoiding confrontations between revelers and police, "is a PR dream for the mayor's office, and they know it," Saliba says. "Sam's a big supporter of the event, but he doesn't understand what it needs."