ONCE again, an environmentally sensitive tract in Sterling Forest just north of New Jersey is threatened with development. Once again, it's a horrible idea.

Sterling Forest LLC - the same developer that once wanted to build thousands of housing units on the wooded slopes of this crucial watershed land - is at it again. Although some 20,500 acres of Sterling Forest have been saved as New York State parkland in recent years, the developer still owns a key 570-acre parcel in the heart of the park, and it is advancing plans to build 107 mini-mansions there.

As conservationists testified at an environmental-impact hearing last week, the developer's plans raise huge questions about the wisdom of building in the middle of a heavily wooded and mountainous state park.

Most noteworthy, punching a hole in the middle of the state forest would diminish the environmental value of the surrounding state land and would radically alter the landscape. To facilitate access to the development, the plan is to blast a 98-foot-tall gouge through a tree-covered ridge. According to JoAnn Dolan of the Sterling Forest Partnership, a non-profit conservation group, the new road would create a "scar as big as a football field."

There's also concern that the development would threaten the quality and quantity of water going into New Jersey's Wanaque Reservoir. The construction could eat into a buffer zone shielding a state-protected wetland - no small matter, given the runoff of fertilizer, pesticides and other chemicals normally generated by a large housing development and its huge expanse of lawns.

Significantly, Sterling Forest is home to black bears, bobcats, coyotes and timber rattlesnakes. Some of the houses would be right next to one of the largest dens of endangered rattlesnakes in the state.

Encounters between dangerous creatures and humans or house pets are inevitable if the development is built. And you can bet that when the resultant encounters occur, residents will be screaming for the critters to be killed or removed from their own habitats.

Lewis Heimbach, president of Sterling Forest LLC, says that his company "will meet every regulation that is required of us" - as well it should. He says that the environmental impact of so few houses on so many acres would be minimal, and that the opposition is merely trying to thwart or delay his project.

But this parcel is too valuable for authorities to give his company a green light without a thorough review and a hard look at the long-term consequences of this development.

The larger question is whether the heart of Sterling Forest State Park is an appropriate place for new housing. From the public's standpoint, the answer is a resounding no.