(Corrects 1st paragraph to say Key West is the southernmost city in Florida, not in the United States)

By Michael Haskins

KEY WEST, Fla., Aug 18 (Reuters) - As Tropical Storm Fay buffeted Key West on Monday, islanders displayed the nonchalance that has earned Florida's southernmost city its laid-back reputation.

"I might close if there are no customers, but not because of this weather," said Sean Kiborn, manager of Starbucks on Key West's main thoroughfare, Duval Street.

He said he would board up the store's large windows if the winds reached a steady 70 mph (112 kph). So far, they've fallen short of the mark.

The island city of about 25,000 residents lies at the end of the 130-mile (210-km) Florida Keys archipelago and its economy depends heavily on tourism.

With most of the tourists driven out by mandatory evacuation orders for nonresidents, the historic Crowne Plaza La Concha hotel shifted into its traditional role as a haven for journalists reporting on the storm from saloon-lined Duval Street.

"We are treating this as a practice run," said Charles Young, general manager of the hotel, which was built in 1926 and withstood the islands' notorious 1935 hurricane.

"We are putting our hurricane plans to work and seeing if they need to be tweaked. It is good training for all of us."

Young says expects the hotel to be back to normal by Wednesday.

Bob Pearce, a local carpenter, bought a handful of cigars from Grumpy's Cigar Shop and said he wouldn't leave.

"Not for this," he said. "My apartment has a generator so I'll have power. ... Now I need to go buy some food and extra beer."

When Michael Knowles, general manager of the DoubleTree Grand Key Resort, learned that worried parents and coaches had canceled a beachfront award ceremony for Little League baseball players, he made them an offer they couldn't refuse.

"We had an empty hotel," Knowles said, "so I offered to donate the space so the Little Leaguers could hold their award program."

Key West was devastated by a hurricane in 1921 and in the aftermath, Sister Louis Gabriel built a grotto on the ground of St. Mary Star of the Sea Catholic Church. A plaque at the site quotes Sister Gabriel as saying, "As long as the grotto stands, Key West will never again experience the full brunt of a hurricane."

Worshipers of varying faiths came to the grotto to pray for safety as the storm neared.

"I believe in the grotto," said parishioner Sue Barroso, "and don't believe we will get a direct hit."

Hurricane Georges hit the island in September 1998, but there were no deaths directly related to the storm, according to the National Weather Service. A powerful hurricane in 1935 killed hundreds in the Florida Keys, even though it didn't hit Key West directly. (Writing by Jane Sutton, editing by Jim Loney)

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