PORTLAND, Oregon - August 5, 2010 - No need to jack up the price of a glass of lemonade. Turns out children won't have to shell out $120 for a health permit to run their lemonade stands after all.

Multnomah County's top elected official apologized Thursday for health inspectors who forced a 7-year-old girl to shut down her lemonade stand last week because she didn’t have a food-safety permit.

Chairman Jeff Cogen also said he has directed county health department workers to use "professional discretion" in doing their jobs.

Inspectors told Julie Murphy and her mother, Maria Fife, to stop selling lemonade at the monthly Last Thursday arts festival in Northeast Portland last week. State law technically requires that even lemonade stands have temporary restaurant licenses, which cost $120 for one day.

Cogen said the inspectors were "following the rule book," but should consider that food-safety laws are aimed at adults engaged in a professional food business, not children running lemonade stands.

"A lemonade stand is a classic, iconic American (child’s) thing to do," he said. "I don't want to be in the business of shutting that down."

Cogen talked with Fife for five to ten minutes to apologize.

Fife said she appreciated his apology after the furor and her daughter was happy because "she's starting to see it had some effect."

Fife also said a radio station has offered to sponsor a lemonade stand for Julie.

The mother and her daughter had gone to Last Thursday because it seemed like a fun place for Julie to open her first lemonade stand, said Fife, who lives in Oregon City.

But after 20 minutes of selling lemonade made from their gallon jugs of bottled water and Kool-Aid packets, a health inspector asked for their license. They didn't have one, and the inspector warned them to stop or face up to a $500 fine.

Initially, vendors at other booths encouraged them to stay, but the inspector returned with another woman. The crowd surrounded the two inspectors, who felt threatened, Cogen said. Fife and her daughter, who left the street fair crying, packed up and the two inspectors left.

Several people who read about the stand in The Oregonian offered to pay the girl's fee so she can sell lemonade. In addition, one of the Last Thursday vendors is planning a "lemonade revolt" at the festival this month.

Cogen and health department officials said they aren't sure what their response will be if people set up unlicensed lemonade stands, as the protest calls for. Cogen emphasized that his employees' safety is also a top concern for him.

The problem illustrates an ongoing dilemma for the health department - and other local agencies - in regulating aspects of Last Thursday, Cogen said.

Unlike other events including the upcoming Bite of Oregon or the Cinco de Mayo festival, the free-form Last Thursday fair along Northeast Alberta Street doesn't have a single organizer who takes charge of signing up vendors. People set up booths on a first-come, first-served basis. They don't have to register for space in advance.

The county health department still needs to monitor the food operations at Last Thursday for public health reasons, said Wendy Lear, director of business services for the county health department. Instead of dealing with a single organizer - who typically has a list of participating vendors and could provide the basic sanitation and hand-washing facilities - health inspectors have to check with each vendor.

The festival has grown in scope and in cost to taxpayers. In February, the city said it spends about $10,000 a month in the summer for police, security, barricades and traffic control for Last Thursday. Residents have complained of festivalgoers urinating and vomiting in front of their houses and other drunken and rowdy behavior.

City Commissioner Amanda Fritz said she and Mayor Sam Adams will present a plan for Last Thursday in the next two weeks. She declined to discuss details, though she noted that vendors at Last Thursday don't pay vendor fees, which she said is "different from any other street fair" in Portland.

She added she believes the health inspectors were right to shut down the lemonade stand.

"When you've got 15,000 people, it's no longer a neighborhood event, it's a regional event," she said. "The county has the responsibility to fairly enforce the rules on permits and food handlers' permits."