Officials at the Simpson mill, where wood chips are cooked with chemicals to produce paper food containers, admit they are to blame for the predominate sulfur smell of the area. But they say they have spent more than $38 million upgrading their mill in recent years. One result, according to state and Federal officials, is that air pollution from the mill has been significantly reduced.

''There will always be some odor associated with this process,'' said Jerry Ficklin, environmental services manager at the Simpson mill. ''The goal is to keep that odor from being offensive to the community. I grew up here, and I'm 50 years old now; there's no comparison between the odor then and now.''

Still, on those days when wind is low and the smell is high, Tacoma can still come in for some stinging criticism. The rock star Bruce Springsteen, a native of New Jersey, which has its own brand of olfactory violations, said the smell here made him so sick on a concert tour three years ago that he had to leave town early. When the incident was reported in Rolling Stone magazine, Mayor Sutherland tore up copies of the article at a news conference.

''Most of the stench originates from certain out-of-town writers,'' said Mr. Sutherland.

Mr. Springsteen is due back in Tacoma for two shows in May, and his visit, as well as a recent business study that concluded that the smell was hurting the econony, have rubbed regional pride - in both directions.

''The smell is 90 percent perception, 10 percent reality,'' said Mayor Sutherland.

But Mr. Stortini said the odor was more than illusory, calling it an ''obstacle to economic growth.'' In order to attract new, nonpolluting companies to the area, the smell must go, he said.

In addition, convention and tourism business has become a key economic factor. This year Tacoma was host to the women's Final Four college basketball tournament and will do the same next year. Last year it was the site of the United States figure skating championships, a time when one of those dread inversions settled on the area. Sportswriters covering that event proved to be the chief carriers of Tacoma aroma jokes.

However the Chamber of Commerce reports that most recent visitors do not find the area so offensive. ''We do these surveys, from hotel visitors,'' said David Graybill, the chamber's director, ''and the most frequent comment on the card was - you're not going to believe this - how much they liked the clean, fresh air.''