Credit lines for photographs that accompanied the story about Cambridge in last week's Real Estate section were incorrect. John A. Mellin was the photographer.

This sleepy, economically depressed Eastern Shore town may be on the verge of a long-awaited revival.

City officials and business people here are pinning their new-found hopes for the rejuvenation of the town on an ambitious waterfront-development project aimed at pulling in tourist trade and attracting new business.

It is estimated to cost $60 million.

The Cambridge Creek project now under construction is to include 436 luxury town houses, rental apartments, a 200-room hotel, a fancy waterside restaurant, a housing project for the elderly, office and shopping space and a marina to attract bay sailers.

The first 22 creek-side homes, which will be priced at $100,000 each, are scheduled to be completed within the next three months, according to Ray Carignan, director of economic development for the Dorchester Chamber of Commerce.

This waterfront village will be located on the banks of a small but deep creek that flows into the Choptank River from the center of this town of 10,000. The area had been filled with eyesores -- old warehouses, decaying wharves and a gravel dump -- that reflected the generally poor state of the town.

Largely overlooked among Eastern Shore towns, Cambridge aims to find a place in the new business sun and to entice people to stop, spend and even stay en route from Washington to Ocean City in summer. Traffic usually slows around the 45-year-old bridge that takes Route 50 vehicles over the two-mile-wide Choptank.

"But who thinks about stopping in Cambridge unless its for a fast-food sandwich or gas?" asked Bob Davis, owner of a men's store here. "We've got a waterman's tradition here, skipjacks in the creek and even big fishing ships that unload on a run from Iceland."

Cambridgers have been buzzing for more than a year about the plans, made after nationally acclaimed developer James W. Rouse (an Eastern Shore native) accepted an invitation to appraise the town and its new dream for core resuscitation.

The upbeat, financially astute Rouse, who now is semiretired, offered encouragement and ideas to the town's "creek committee." He suggested that new construction should be connected with the old downtown by a hotel that would attract visitors and tourists lured by Cambridge's vast water facilities.

The creek committee was granted a budget of $140,000, 15 percent of which was raised by interested business officials. The remainder was provided in equal shares by the Cambridge and Dorchester County governments. The committee contracted with American City Corp., a Columbia-based subsidiary of the Rouse Co., for a detailed plan for replacing grubby buildings with a waterfront village on both sides of Cambridge Creek, to be coordinated with rehabbing and restoration of the downtown area. (Although most of the planning funds for Cambridge Creek came from local governments, the individual components of the development are being privately financed, according to Carignan.)

"We needed the Rouse prestige and record of success in Boston, Philadelphia, Baltimore and other cities," commented Herman Stevens, publisher of The Daily Banner. "This will not be another Faneuil Hall in Boston but a sort of mini Harborplace Baltimore . Our group tried for years to get new industries here, with only limited success. Now we want to go the tourist-residential route to attract new people and dollars and develop our water-oriented opportunities."

Stevens, a silver-haired go-getter, leads a group of business people that owns a relatively small piece of property on the creek. Major creek landowners are Phillips Oil Co., which already is redeveloping its site, the Arundel Corp. and businessman William Coombs.

Bob Davis, a partner in the Stevens group, said "our share is minimal, but we think everyone has a stake in the creek project. This town needs new blood, new people and more good jobs. This is basic free enterprise at work."

But not everyone supports the idea of using public funds for the creek project. State Sen. Fred Malkus (D), for example, opposed an earlier proposal to obtain planning money from a state bond issue. A Dorchester County resident who has a law office in Cambridge, Malkus said that "no state taxpayer money should be used for development of this property. I have not done a thing to help it.

"Where will the people come from to buy these expensive houses?" Malkus asked.

Cambridge has a shrinking middle class and probably more than an average share of both affluent and low-income residents. Few wage-earners take home more than $250 a week. Hundreds of Cambridge houses are small, old and rundown.

Douglas Allen, who heads the Dorchester County Community Development Corp., recently expressed concern that the creek project will not benefit the black community except on a trickle-down basis. Allen suggested the project would be more acceptable to lower-income residents if they were trained and hired to build the new residences and hotel.

Mayor Lloyd Robbins, on the other hand, insisted that the project will provide employment and ease social tensions, which he regards as essentially economic.

The creek project that has aroused enthusiasm and some controversy within Cambridge, the 290-year-old seat of Dorchester County, has not gone unnoticed elsewhere.

The nearby Easton Star-Democrat (to the north in affluent Talbot County) editorialized at length.

"There is no cause for panic, but Easton and Talbot County planners and businessmen ought to pay some attention to what is going on south of the Choptank," the paper stated. "The Cambridge Creek project is alive, and so are Cambridge's hopes for the future . . . Talk of a new hotel and convention center in Cambridge to compete with the Tidewater Inn in Easton is something to think about."

Cambridge leaders insist they are not trying to compete with trendy Easton, St. Michaels and Oxford or even with much bigger Salisbury to the south. Retail sales in Talbot County exceed those in Dorchester by 50 percent. Salisbury is the Eastern Shore's big town, attracting shoppers from Centreville to Ocean City.

A new Cambridge-Choptank bridge is needed. The low-lying span was dedicated by President Franklin Roosevelt in 1935. Malkus recalls working on the bridge as a "young rod man making $13 a week." Now the bridge is on the Federal Highway Administration's "worst" list.. Malkus estimates it would cost $80 million for a new, wider bridge. But he said he is confident work will begin in a few years and be financed by tolls from state bridges and roads.

Cambridge badly needs more jobs. A recent Maryland economic study of Dorchester County pointed out that young people leave for better employment elsewhere and that old business properties downtown are starting to deteriorate. The report also noted that enlargement of food-processing industries and development of recreation facilities and services for tourists would provide more employment--but not higher incomes.

"The population tends to be older, less mobile and poorer than the state average," the report said. "The economy is perrenially subject to high rates of unemployment."

Nevertheless, Cambridge has some attractive new buildings, including its library, near the creek site and within easy walking distance of the old downtown. Some of the fine old residences on stately High Street are both historic and charming. Plans for center-town business rejuvenation are expected to conform to traditional architecture and promote "removal of overscaled signs and false fronts."

John Magladery of American City Corp. said full realization of the plan "requires financial support from both government and private sources." He also noted that public funding will be needed for creek bulkheads, utilities and new roads.

Statistics and marketing reports usually are cited to support viability of a large new hotel, but Magladery and the ACC staff said it would be "difficult to quantify the need for a high-quality inn in Cambridge."

If a convention hotel is built in the heart of Cambridge, it is likely to be a local enterprise because "it will be difficult to attract a recognized national chain hotel operator," Magladery said.

The creekside residential development is intended to provide modern, attractive living for people wanting to keep a boat at their doorsteps and have a glorious view of the water from a balcony or terrace, Magladery said.

Much of the creek project represents a grand dream for hard-up Cambridge, but the start of work on the first town homes signals both a physical and a spiritual change. With some luck, Cambridge may surprise itself and its Eastern Shore neighbors by renewing itself dramatically before this decade ends.