Maikel Carder resides in a boatyard trailer where he also makes high-quality knives. His business, Stone Soup Custom Cutlery, is named after a parable about the virtue of sharing.

It kicked off a weekend celebration that included the Koronation Kostume Ball, in which the Rose Hip Kueen would be krowned (there is such attention to kitsch that all hard c's must be changed to "k's"), and the Kinetic Skulpture Race. Human-powered Kontraptions were expected to negotiate streets, a stretch of bay and a patch of mud known as "the dismal bog." Every racer would have to carry a Teddy Bear for comfort, and the winner was the competitor who finished in the middle.

The most polished entry featured a flapping black-and-orange butterfly with a 4-foot wingspan. Charlie Bodony, who used to build sets for the Seattle Opera, unveiled his 10-foot-tall, 17-foot-long, four-seat, four-transmission bicycle named The Looney Rover, which took him and volunteers several thousand hours to design and build.

The Jefferson County Historical Society recently referred to this photograph of early settlers along the Hoh River as the county's "original shed boys."

Daniel Smith, who has lived in Port Townsend only since April, but discovered it in the late '80s at the end of a bagpipe-playing charity walk from Maine to Neah Bay, cobbled together a flying saucer from an upside-down satellite dish, inner tubes and Western Flyer bike. As part of his Space Kadet outfit, he wore four-digit rubber gloves and painted himself silver from head to foot. He won the coveted award for the cheesiest entry.

The vehicles were the stars of the parade, but the energy was supplied by flutists, drummers, kids on bikes, artists in face paint, ever-aging hippies, all of whom just seemed to show up at the last moment before the "low noon" starting time. The procession, a menagerie of out-of-sync themes, marched down Water Street and past 100-year-plus Victorian brick facades that symbolize how serious Port Townsend's dream of being Seattle once was.

All small-town parades reveal community character, but the Kinetics event, with its feel of Halloween and Mardi Gras, reaches sub-local levels. It reassures that behind the sheen of historic architecture, wooden hulls and watery vistas, Port Townsend is still a place where people go to great lengths to create their own reality, no matter how idiosyncratic.

Ever since city fathers miscalculated in the late 1800s that the railroad would come through and make Port Townsend the Northwest hub, it has had the nickname "City of Dreams." The population of 8,300 isn't much more than it was back then, and some former and present residents call it "the City of Broken Dreams."

The Kinetic Skulpture Parade is a come-as-you-are affair, heavy on costumes and easy on planning. A woman who calls herself "Still Standing" joins the festivities.

Still, it is far removed from the beaten path, self-contained and open enough to strike each newcomer (and it seems that nearly every resident is from somewhere else) as a blank canvas waiting to be painted. Port Townsend rests at the end of the road on a peninsula that sticks out like a thumb from another peninsula, so moving there requires investment in a dream. The dream may involve seeking something fresh or running from old headaches like traffic.

It's a town where an engineer lives in a garage, the pizza guy has a theology degree, an entrepreneur works in a shipping container. It's a town where bulletin boards are clogged with fliers from people seeking "a safe and sacred place to cleanse the spirit," advertising a school bus as home for rent and offering help in translating "the difference between waking dreams and daydreams."

Perhaps it was the sight of "chicken salutes" and a 30-something baton twirler bouncing alongside a Curious George Skulpture that made such an impression. Perhaps it was the timing of it, just hours before U.S. allies began bombing Afghanistan. Whatever it was, Port Townsend never seemed so end-of-the-road.

MAIKEL CARDER had roller-bladed through the parade dressed as a hipster dude, but as skulptures went through brake and float tests for the next day's big race he headed home, a 13-foot trailer in the corner of a boatyard. He opened a closet and showed me a skimpy dress he planned to wear that evening to the annual Kinetic Kostume Ball, which demands outrageousness. Carder had never dressed as a woman, let alone a tart, but he thought it would help him become a more complete person.

The beach at Point Hudson is right outside the door of his Airstream, but there are times when Joe Breskin must focus on the projects that present themselves on his computer screen.

Lucy La Rosa of Port Townsend shows off an ultrasound image of her baby making what looks like the Kinetic "chicken salute" from inside the womb. La Rosa is moving from a shed community into town to raise her baby.

"It scares me to go out in public dressed like a woman," he said. "That's why I must."

Carder is not the kueen type. He's a wiry, leather-skinned 59-year-old with a gentle English accent, a reflective mind and a long scar from a knife-sharpening accident running down the palm of his right hand. He does, however, fit a certain Port Townsend archetype that moves far beyond the tourist radar. He values time over money, peace of mind over appearance.

He wandered the country for a decade sharpening knives and preaching simple living. He wouldn't charge for the service, calling it his contribution, but would accept donations, sometimes in the form of a shower. He recalls his favorite bar (Arkansas) and favorite waterfront (Maine), but when his van drove over the crest at the southern entrance to Port Townsend in the mid-'80s, the town felt right enough to stay awhile.

The interior of his trailer is four paces long. It has a bed at one end and a shelf that doubles as a desk at the other. He taps into a boatyard power source to operate a small stove and his knife-grinder in a tiny connecting shed. The walls of his living space are dotted with index-card reminders: "It doesn't matter how slowly you go as long as you don't stop" . . . "The duty to produce destroys the passion to create" . . . "If you live long enough the culture will find the truth of your eccentricity and embrace it."

Before finding his current nook on the edge of town, he spent five years in a crammed neighborhood of boats, trailers and sheds known as "the funky boatyard." Most of his neighbors were workers in the boatyard, but they were all eventually evicted by the Port of Port Townsend to make way for a heavy-boat haul-out.

Carder's lifestyle requires toting water, maintaining a tiny garden and cleaning up in public showers around town. As he showed me around the perimeter of his trailer-and-shed complex, he celebrated finding the carcass of a rat he suspected was the one skittering inside his home at night.

"Voluntary simplicity is an option that looks good if you're a professional who has decided to live on $80,000 instead of $160,000," he said. "Then you can still live the Martha Stewart way. But a lot of people live like this here because they can't afford this town. For me, it's a choice."

Carder says he studied international relations and worked for a think tank in England and the United Nations, where he saw firsthand the disparity between the world's haves and have-nots. "You simply cannot have one-sixth of the world consuming 50 percent of resources and tell other countries they need birth control. You just have to share. There is enough for everyone."

He named his one-man knife-making business Stone Soup Custom Cutlery, after a European parable that preaches the more you share the less you will need. He spends hours shaping high-carbon steel blades, polishing handles and testing the weight through chopping motions. He has about 40 orders to fill from the summer's craft fairs, but they must fit into his schedule, which includes reading, sailing and wandering.

Staying this long in one spot has helped him build confidence and become more social. Attending the ball in drag is part of that mission.

"I'm sure when I get there, there will be a dozen guys dressed as women and with far better accessories than I," he said. "Then I'll wonder why I'm wearing those uncomfortable high heels and panty hose."

IN CURRENT TOWN parlance, Carder is a "shed boy," a catchy term applied to a non-catchy lifestyle. It refers to people, mostly single men, who live off the grid and low-on-the-hog. Many of the homes aren't exactly sheds. They are boats moored on land, trailers, buses, vans, somebody's spare bedroom, a shipping container. For many, being a shedder is more attitude or necessity than address.

Cory and Catska Ench, artist-musicians who live in a studio space above a hardware store, climb back into their Volkswagen microbus after marching in the Kinetic Skulpture Parade. Cory donned a wig for the occasion.

Some residents say the shed-boy buzz, started by the local newspaper, The Leader, is a joke, much ado about a few uninspired men. Others, though, say it captured a Port Townsend archetype and highlighted the city's lack of affordable housing and decent wages.

The Leader articles, written by freelance reporter Rebecca Mizhir, who once was part of a writers' group known as the "trailer poets," captured community attention and sold a lot of newspapers. There was talk of a novel ("The Shed Boy Murders") and jokes of a shed tour. Merchants on tourist-friendly Water Street advertised shed-boy fashion statements.

Many of the people who best meet the definition won't talk about it. They live far off the curb for a reason, and fear the code-enforcement officer. One man, who is devising technology that apparently has interested a major company but lives in a school bus, wanted nothing to do with me. I was escorted to a mini-village of sheds and trailers by one of its residents, but a guy who claims to be a shaman sent word I best not go near him or his trailer.

The biggest problem with the label, as with any label, is that it oversimplifies.

No-frills living has long been practiced around the Olympic Peninsula, first by Native Americans and then with transient communities of fishing and logging. The Jefferson County Historical Society picked up on community attention and displayed a photograph of rugged settlers along the Hoh River, calling them "The Original Shed Boys."

Even the term has been around the community long before it got popular, says Ilana Smith, a massage therapist. She used to let shedders use her clawfoot bathtub. Occasionally, they offered dinner in trade. "One guy gave me a potato," she says.

Jim Anderson, who lives in a trailer inside a boatyard shed, is sort of a shed entrepreneur. He quickly registered the Web site address, www.shedboyz.com, which he and a partner use to promote local concerts. He also came up with the "Shed Boy Burger," served at his favorite dock café.

The maritime heritage of Port Townsend is easy to see along the waterfront, where ferries mix with finely crafted wooden boats and other ships.

Trained as a machinist, Anderson, 45, fished in Alaska and piloted a boat he had brought down the Inside Passage in 1989. He hauled it out for repairs in Port Townsend and has lived the shed life since. Now he maintains and builds Web sites and produces interactive CDs from his trailer. He also builds his own line of "skimboards," a cross between surfboards and skateboards that riders use to slide across pools along the beach at low tide.

"I've finally come to grips with the fact that I'm a really creative person and need time to create," he told me. "I used to have a machine shop that took me a couple of years to get going. It was very successful but I never went home. I decided I wanted a life."

If Anderson is a shed-boy businessman, Milo Redwood is a shed-boy Thoreau. He lives in a boxy silver mobile home, which he acquired in trade for his house-painting services. It's parked on a corner of John Barr's uptown property. Barr runs his own landscape business and lives in a cottage on the site. Barr's ex-wife lives in the house a few feet away.

Redwood is a pastel presence. He's tall, redheaded, has soft blue eyes and speaks slowly. He reads more than he works and is about 600 pages into an observational book with a working title of "Letters from Happy Camp."

He used to sell real estate, work in a bank, own a house and pay car insurance on the other side of the country, but he eventually dropped out and set out to find a name and place that suited him better.

"Port Townsend felt like a lover," he said. "Actually, it felt better than a lover."

He's behind on his modest rent, so Barr, who is a friend, has become part owner of the mobile home. Redwood doesn't seem worried about that, or anything.

THE SIMPLE LIFESTYLE must blend into a complicated little town. The paper mill is still the largest private employer by far, the tourist trade generates exposure and the marine community provides a certain romance. Port Townsend is also home to a vibrant community of writers, musicians, artists. It is a blue-jeans town with high-brow events and a well-traveled, educated population.

			On the edge Set on the tip of the Quimper Peninsula, which is only a small part of the larger Olympic Peninsula, Port Townsend feels like an island.

It is a town with few fences, but people are starting to build them. Although births have stayed constant at about 200 a year, Jefferson County has grown considerably, and the fastest-growing segment of its population is older than 65. An unusually high percentage of residents lives on trust funds. The percentage of children born to mothers on Medicaid is above the state average. Wages are low, well-paying jobs are few. The median family income is below that of nearby Kitsap County, but median home prices are far higher. The underground economy seems stronger than in most places.

Port Townsend has morphed several times since it was settled 150 years ago. Prim, tree-lined downtown used to be rampant with hard-drinking sailors, wanderers and adventurers (author Jack London spent a night in the pokey on his way to Alaska). Gambling and prostitution were widely practiced in the sprawling brick saloons that now house hotels and shops, and the city earned a reputation as shanghai capital of the West Coast.

It was a boomtown in the late 1880s, at the entrance to Washington's inland waters, bustling with ships and on the verge of being a link in a transcontinental railroad. The population was close to what it is today, and built with 21,000 in mind.

The railroad never came and Port Townsend went into slumber. In the 1970s, people moved in and began renovating the mothballed historic buildings. The Town Tavern, which provided a place to stay in return for work, became a magnet for wanderers. The '80s saw an influx of writers and artists and a rekindled wooden-boat tradition. By the '90s, the chamber began marketing not just the community's beauty but its artistic side.

Milo Redwood dropped out of the workaday world many years ago and now house-paints just enough so he can spend the majority of his time writing and reading inside his trailer. When he writes, he holds a carved stone from the Makah Indian Reservation and a crystal to make stronger keystrokes on his manual typewriter.

Recently, more people with money have moved in, further complicating the balance of competing dreams. The latest wave of newcomers is unkindly referred to as "trustafarians." One native who resents the way the liberal elements exert their definition of Port Townsend says, "This is where hippies go to die, but they just won't die!"

Some folks around town still celebrate preventing franchise businesses like Rite Aid and Hollywood Video from moving in, but City Manager David Timmons says the flip side is that few such businesses even want to move to the end of the road.

"There is kind of an island mentality here," said Timmons, who arrived from Vermont a few years ago. "We're isolated enough that people don't get lost as much in outside events, so everything that happens here is highlighted. People say they don't want us to be a tourist town, but I tell them, 'I think you're too late.' Some say they don't want us to be a retirement community. Well, the demographics say we are."

The dialogue got so rancorous that about 250 people were invited to a town hall meeting this past summer to brainstorm on how to keep disagreement civil. The idea that received the greatest applause was closing traffic on Water Street one day a month so folks could mill about and talk. Katherine Baril, who left Seattle 20 years ago and co-hosted the meeting, said the community has to somehow define the soul it seeks to protect.

"People move here and say this is perfect, but I need a pretzel stand. Or I need this or that," she said. "Soon they've brought Nirvana closer to what they've left. With the active mariner community and all the strange people coming through, we're a smaller part of what Seattle used to be. We're an edge community. Natural systems are most productive, chaotic and crazy on the edge of a meadow, forest, wetland. It's the same here, and we revel in that."

EVERY RURAL Northwest community has people living without running water, but many of those living in Port Townsend have cell phones, computers and purpose.

Former restaurateur Wisteria Wildwood uses her grandmother's old stove to cook and heat her 370-square-foot home.

Joe Breskin lives amid a tight row of trailers and mobile homes 20 yards from the beach at Point Hudson. When I walked past his pile of kayaks and into his home, he was kneeling on the floor, grimacing over the innards of a computer he was fixing for a friend. His own computer was humming along in a cubbyhole where he churns out papers, documents and observations about everything from salmon habitat to technical efficiency.

He grew up on Mercer Island and went to New York right out of high school, seeking to be the next Jimi Hendrix. He's 50 now and has spent more than two decades in Port Townsend. He has designed sailboats and software and consulted on environmental projects. He still jams on a guitar he made.

He uses the community showers, eats breakfast at the same dock café each morning and kayaks to let his mind wander. Several people in town refer to him as a genius, and he had a chance recently to move to a good-paying job in Seattle, but turned it down.

"My decision is what I saw out my window when I woke up," he told me, motioning out to the sprawling vista. "What would a view like that cost in Seattle? What is each day worth?"

Jim Anderson, a Web-page designer and skimboard maker, props open the door to his shed, which serves as car port, garage and home to his trailer.

Like most Port Townsend residents, though, Breskin is not shy about criticizing the ways in which the town is changing.

"People come and see the music festival and they fall in love with the place and they buy in. They bring money with them, buy businesses and live well as long as it lasts. Most of them fail and flunk out. Many B&Bs have been bought again and again, which is why I describe them as being like the plastic bags in the ocean that kill sea turtles, one after another."

Way on the other end of the Port Townsend-area landscape, Wisteria Wildwood lives in a clearing of trees. She went to the Kinetics ball dressed as a mermaid, but wore work clothes when I visited her home. She held back two big dogs while opening the metal gate to her property so I could nudge through.

Wildwood showed off the ingenuity of her subdivided chicken coop and the healthy state of her flowers, shrubs and garden of onions, garlic and tomatoes. I expected nothing less from a woman who named herself after flora and used to own a successful one-woman organic restaurant in town.

Just in case I hadn't noticed, she emphatically stated, "the Mariners don't exist in my world."

The "shed boy" culture may emphasize simplicity, but that hasn't stopped entrepreneurs from finding ways to sell the concept with burgers, bumper stickers and more. The Shed Boy Burger is served at Sea J's, a waterfront diner where shed boys hang out.

She is a feisty, funny woman, about the same age as Breskin, with shoulder-length strawberry blond hair. She lives in a 370-square-foot straw-bale house that a former boyfriend helped build. Her bookshelves, built high on the walls to save space, hold do-it-yourself tomes like the "The 12-Volt Bible," "The Garden Primer" and "Making Furniture."

Wildwood sold her restaurant, the Wild Coho, two years ago to a Seattle couple. She calls herself the "Queen of the Shed Girls," not just because she lacks running water but because she helped rekindle the term when her restaurant served up the "The Shed Boy Scramble" for $4.95 several years ago.

While admiring the shed ethic of making time to create or just be, she is not one to sit idle. She has been a gravel truck driver in Seattle, a tugboat owner, a cook in a remote Alaska resort. Now she does a couple shifts at a local café and caters so she can make enough cash to finish working on a 1954 tomato-red Chevy pickup she bought for $100. Several other projects, including a composting toilet and a wood-stove sauna, are in various stages of completion.

"Everything here is a work in progress," she said, shrugging, "including me."

Misha Berson is theater critic for The Seattle Times. Jimi Lott is a Times staff photographer.