KENNEBUNKPORT, MAINE -- As controversies go, this one doesn't rank up there with the White House versus the Congress on taxes and spending. As high drama it hardly rates with the ongoing Persian Gulf crisis that preoccupied the First Resident of this seaside resort community the past month. But as a summer soap opera, the flap over public toilets does just fine.

For years, Kennebunkport never had a problem, but then it never had public toilets either. The people who came here, wealthy people mostly, never raised a fuss over their absence. Perhaps the lack of public facilities helped keep the place the way they wanted it.

But over the years Kennebunkport, the summer home of President Bush, has changed, attracting tourists, often with small children in need. Adults too, mind you.

This set off a conflict between the merchants and the town government: Each recognized the problem, each proposed that the other provide the answer. The taxpayers, understandably, were reluctant to dip into their pockets, and for a time there was a standoff. "Finally, people got embarrassed," said Steve Morris, president of the local Chamber of Commerce.

A truce was established, and with it came two facilities available to the public. The towns of Kennebunkport and neighboring Kennebunk each put up $100 so the facilities could be called public, the local sewer commission granted a waiver to its normal impact fee, and the doors were opened -- or closed, technically -- for business.

With a catch. The public has been asked for a donation for usage to defray the costs of operation, paper products and cleaning. No one in need is turned away for lack of donation, but the concept has irked some of the tourists who flock to Kennebunkport to drive by the president's home on Walker's Point, hoping to catch a glimpse of Bush on his speedboat Fidelity and to buy Bush memorabilia.

Despite the grumbling, "we've solved the crisis for this season," Morris said. "Who knows what next season will bring?"

Local residents are protective of their friend the president and have been cheerleaders as he has grappled with the Persian Gulf crisis.

At Bartley's Dockside pub next to the Kennebunkport River, a chalkboard message, visible to the thousands of cars that cross the bridge into town each day, reads: "Mr. President -- with Gorby behind you and the Saudi's financing our troops . . . well . . . not bad for a man on vacation! When George gets back to work, watch out Saddam!"

Friday night, as Bush's motorcade whipped through the center of town heading home after the first dinner out of his vacation, tourists and others lining the streets applauded.

They are also protective of his privacy, but despite this feel-good spirit, Bush's election brought disruption to the town, and local businesses felt it a year ago.

With fears that the town would be overrun with gawking tourists, tight security and the intrusive news media, many people decided to stay away in the summer of 1989. Hotels, motels and inns had cancellations; longtime summer visitors decided not to make their annual pilgrimage.

This year, the number of tourists coming for a few days or a week appears back to normal.

"Kennebunkport seems to have rebounded," said Lindsay Copeland, who runs the Maine Stay Inn. "So maybe the president's presence is a positive."

Nevertheless, if Bush were to ask the people of Kennebunkport, as Ronald Reagan did of Americans in the 1980 campaign, "Are you better off than you were two years ago?" he would get a resounding "No."

Like the rest of New England, this town is suffering from a recession. The once-booming real estate market, which saw appreciations of nearly 2 percent a month at one point, has gone into a tailspin, with values off 10 to 20 percent or more. The building trades are suffering, as is the service economy.

Local business people report that tourists are spending their money more carefully, looking for bargains in eating and quality in kitsch.

The pattern is irregular, but some shops say sales are sluggish. "I think it's down a little," said Mat Lanigan, manager of Saxony's, a store on Kennebunkport's main drag that sells Bush memorabilia, including demitasse cups with an image of the president that makes him appear to have a head of hair like Beethoven's.

"It's the worst I've seen it in a long, long time," Morris said. "People are hunkering down to ride out the storm."

Speaking of riding, the president and First Lady Barbara Bush threw a party for the press corps Friday.

Bush had arrived back from his three-day trip to Washington Thursday evening to some of the best weather of his August vacation. There was a gorgeous sunset that set the horizon glowing a soft pink.

The Bushes served hot dogs and hamburgers to more than 240 people and gave the reporters and their families free run of the grounds of their home, as the First Couple chatted and posed for pictures and the president pitched a spirited game of horseshoes.

Oh yes, the stuff about riding. Remember all those stories criticizing Bush for wasting gasoline on his speedboat Fidelity? Well, he made the boat available for rides to the folks who wrote or broadcast those stories, and, well, they just couldn't get enough.