A Pennsylvania resort owner is considering building a hotel and conference center on an island he owns in the Delaware Water Gap National Recreation Area, a favorite destination of New Jersey nature-seekers.

The expansion plan -- one of three the owner of the Shawnee Inn is considering -- would transform the view from one of New Jersey's most breathtaking stretches of the Appalachian Trail, along Kittatinny Ridge. It also would, critics said, unleash pollution and traffic on a near-pristine stretch of the Delaware River.

"It's always been a bucolic river valley," said Jim Sittig, 50, of Shawnee-on-Delaware, Pa., the tiny town where the inn is located, just across the Delaware River from Warren County. "Everything would change."

Shawnee Inn owner Charles Kirkwood, who runs his far-ranging business enterprises from the rustic inn, said his plan would restore the faded glory of the Pocono Mountains, a once tony destination that is now the butt of jokes about chintzy honeymoons.

"The story isn't someone wants to build something in the middle of the Delaware Water Gap National Recreation Area," said Kirkwood, 68. "The story is a region that is relatively poor is trying to decide which way it's going to go."

The debate has tapped the deepest regional passions of the river valley. Kirkwood's island, Depue Island, is just south of Tocks Island, around which the federal government decided in 1962 to build a dam to create a vast reservoir and a power station.

The government condemned or bought 10,000 properties in North Jersey and Pennsylvania in the 1960s and 1970s. Residents rose up in opposition. The dam plan was abandoned, and all that condemned land became the recreation area. More than 5 million people a year now visit the water gap -- a term for the geographical anomaly of a river cutting through a mountain range rather than running along it.

Resentment over the property seizures still lingers among area residents. But it has been tempered -- even among some whose property was seized -- by their fondness for the park.

"The park was built based on sacrifice," said Nancy Shukaitis, 78, whose family farm was taken by the government. "Whether you liked it or not you sacrificed your land because this was needed for the Eastern Seaboard."

Now it's time for Kirkwood to sacrifice, by dropping any scheme for developing Depue Island, said Shukaitis, who still lives near the park in Pennsylvania. For years she led the fight against the Tocks Island Dam, which the government did not scrap for good until 1992.

"I'll just have to do it all over again," Shukaitis said.

National Park Service officials said they could not comment in detail on Kirkwood's plan because he had not made a formal proposal. But they said the government does have expanded condemnation powers with respect to "in-holdings," as they call private property within the recreation area.

"Depue Island is inside the river, it's wetlands, it may very well be home to endangered plants and animals," park Superintendent John Donohue said. "We would take a hard look at all of that before any development takes place."

The inn has dominated Shawnee since it was built in 1911 by Charles Campbell Worthington, namesake of Worthington State Forest across the river in New Jersey. Famous bandleader Fred Waring bought the inn in 1943 and broadcast his radio show from there. Jackie Gleason, Arnold Palmer and Dwight Eisenhower were among the visitors to its 27-hole golf course, still located on Shawnee Island, just south of Depue Island.

Big names haven't visited the Poconos much in the last few decades. As air travel replaced the railroad, well-off area urbanites started opting for the tropics or Europe. The Shawnee Inn went downscale, like other Poconos resorts. Heart-shaped beds proliferated.

Kirkwood bought the inn in 1977, when its decline was well under way. The son of a second-generation Bethlehem Steel Co. machinist, he had worked as a caddie in the Poconos as a teenager, though he quit a job at the Shawnee Inn after two days because a manager demanded too much of his tip money.

Kirkwood graduated from Harvard Law School and practiced in the Far East, where he owns part of a General Motors distributorship. He has been a prolific developer, and an importer, among other things. He and his partners also own a resort in Myrtle Beach, S.C., and two others on Florida's Gulf Coast.

After Kirkwood bought the inn, he built 600 time-share condos throughout the town, and added an ice rink. But the inn is too empty too much of the time, he said. A conference center would change that, bringing affluent guests in mid-week, even in the off-season, he said.

So Kirkwood has drawn up plans for new bridges to the island, and a 250-room hotel and conference center on it. He said he also is considering building where the ice rink is now, or putting additions on his existing hotel.

But he stressed that there were compelling arguments for the island plan. Depue Island itself had a golf course on it in the 1930s and 1940s, he said. Trees could hide the building from passing boaters. And grand buildings are an asset to many national parks, he said, holding up a coffee-table book called "Landmarks in the Landscape, Historic Architecture in the National Parks of the West."

Both Kirkwood and his opponents invoked the specter of gambling, which Poconos promoters have long sought. Kirkwood said that unless he could help lead the region in an up-market direction, other resort owners would continue to see gambling as the only path back to big profits.

Kirkwood has fought gambling in the past, and said he believes casinos would do no more for the Poconos than they have for the depressed neighborhoods of Atlantic City.

Opponents said they suspect Kirkwood secretly sees a casino in the future of the Shawnee Inn. They are equally as concerned, though, about the traffic and runoff pollution that would come from a conference center. Moreover, they said, the Delaware Water Gap National Recreation Area is too precious to absorb a big new hotel.

"There's this hill and that hill," said Jim Sittig's brother, John, 54, standing on a ridge above his house on the Pennsylvania side and pointing across Depue Island to where the Kittatinny Ridge jutted into the New Jersey sky. "It's not like this park goes on and on."

Alexander Lane covers the environment. He can be reached at alane@starledger.com or (973) 392-1790.