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Cabins, canoes, kids splashing in a lake: Viewed from afar it seems like a typical summer camp. But up close the scene stops looking ordinary: The little boy, his catch of six fish held high and a smile on his face as wide as the lake behind him, is bald, his hair lost to chemotherapy.

Nearby a 12-year-old girl, her leg recently amputated, sits giggling with friends. A T-shirt covers the catheter resting close to her heart. Other children run excitedly through the grounds. Only the pallor of some or the fact that they tire easily reveals that these are youngsters with cancer or other life-threatening diseases.

There is something else special about this camp, which officially opened in late June in Ashford, Conn. It was founded by actor Paul Newman, 63, who hit on the idea when two close friends died after long bouts with cancer.

”They were only in their 40s and 50s,” Newman says. ”After they died I found myself thinking, well, at least they had some opportunities. What about the kids who are facing a short life or one in which their experiences will be extremely limited?

”We are such spendthrifts with our lives,” he adds. ”You have a sense of your own immortality and good health, all those things everybody takes for granted. Then you meet kids like those attending this camp and you have to think twice about it.”

The camp, for youngsters aged 7 to 17, is the latest charitable cause to grow from the tragedy that struck Newman in 1978: the death of his only son, Scott, at age 28, a victim of a drug and alcohol overdose. Although the actor has kept his grief private, it has manifested itself publicly in the Scott Newman Foundation, headed by Paul`s daughter Susan. Its goal is to bring public awareness to the twin problems of alcohol and drug addiction.

Then there is Newman`s Own, the firm that produces salad dressing, popcorn, lemonade and spaghetti sauce. It has donated $15 million to 350 charities since its inception five years ago.

”I`ve been touched by the good fortune of living a long life and having a sense of accomplishment,” he says. ”And I`m aware that there are other people who don`t have those opportunities.”

Newman first met youngsters being treated for cancer when he visited a children`s hospital in New York. ”My reaction was, `What a privilege old age is!` I also realized that for these kids the various components of their treatments-daily doctor visits and chemotherapy or heavy doses of medication- are at the center of their getting through every day.” He said he found himself wondering, ”What if these children had a place where they could forget their concerns for a while?”

”I call it a `careless environment.` So I thought, Wouldn`t it be great to create such a place?”

To do this Newman drew on his childhood memories of summer camp. ”What I remember most was the camaraderie, the campfires, the wienie roasts and taffy pulls. It was an old-fashioned camp experience, being close to nature and the simplicity of it all.”

To that childhood memory Newman added the atmosphere of the Old West and the spirit of adventure. From his movie ”Butch Cassidy and the Sundance Kid” came the name for the project: the Hole In The Wall Gang Camp.

”I wanted this camp to be irreverent and the furthest thing from an institution you could imagine,” he says. ”I also wanted it to look like a turn-of-the-century lumber camp, with log cabins, chuck wagons, campfires, a lake with lots of fish, trails, horses, all sorts of animals and, yes, a cave. I mean, it couldn`t be the Hole In The Wall Gang Camp without a cave, now, could it?”

Newman took his idea for the camp to his friends A.E. and Ursula Hotchner, who with Newman now head the camp`s board of directors.

Then Newman had to find an architect and a doctor. He turned to Yale University, where he had studied drama.

Dr. Howard Pearson, professor of pediatrics at Yale`s medical school, agreed to work with Newman on the camp. And Thomas Beeby, dean of Yale`s architecture school, undertook the camp design, in conjunction with his Chicago firm, Hammond Beeby & Babka, and the New York firm of Russo & Sonder. It was an unusual project for Beeby, one of the country`s foremost architects. ”I was nervous at first,” recalls Newman. ”I kept wondering if he could come up with something that`s ratty looking, you know, funky. I told him, we don`t want anything fancy, just log cabins. What he came up with was amazing.”

Each of the log cabins Beeby designed houses six children and three nurses. The dining hall is modeled after a circular stockade, with room for a stage, turning it into a theater in the round. There`s also a gym and other sports facilities, an arts-and-crafts center and stables. A medical office and dispensary, with their rustic exteriors, are as unobtrusive as possible. They are staffed 24 hours a day.

Ninety campers attended each of the four sessions. The children have cancer, leukemia, histiocytosis, aplastic anemia, sickle cell anemia, thalassemia and other serious disorders.

A staff of 60 supervises their activities. Several counselors themselves have recovered from cancer or are in remission; the remainder are specialized medical and nursing personnel.

The camp is on 300 acres of meadows and wooded groves with 45 acres of lake. The site was chosen as much for its beauty as for its convenience, within access of major medical centers in New England.

And although the serious side of this camp is never forgotten, Newman is determined to make sure it never dominates. It was he who came up with the idea that all the kids would wear cowboy hats so the youngsters who had lost their hair to chemotherapy wouldn`t feel self-conscious.

Newman asked his designers to make sure the camp wouldn`t look remotely like the hospitals that the children usually spend large amounts of time in.

”This is the least regimented camp you could have,” Newman says. ”I want to get the kids away from regulations.”

That includes meals. ”Paul wanted the children to be able to fry the fish they catch in the lake or roast their own hot dogs,” A.E. Hotchner says. ”But Joanne (Woodward, Newman`s wife) said she thought it would be more nutritious if the hamburgers were veggieburgers. They had a little fight about it. Paul`s point was that the kids should eat what they want, not what someone else says they should eat.”

Says Newman: ”I felt if they wanted to stuff themselves with sausage, that`s what they`ll get. If there are some children who need a special diet, of course we`ll attend to that. But if anybody gives lectures about what`s best to eat, he`ll be thrown out!”

Each camper stays two weeks. Newman met some members of his gang at a preview session. ”Some of the kids were in remission, some in chemotherapy, some in wheelchairs,” he says. ”But they all have a way of looking at things that is more mature than is normal for their age. They told me what they liked about the camp, and they also talked about the chance of getting away from hospitals, being with other kids who have similar problems.”

To date, $15 million of the $17 million needed to build and endow the camp has been raised. Newman`s company contributed $7 million. The rest came from public and corporate donations.

Navy Seabees cleared the land; Connecticut Jaycees and other professionals volunteered time and materials.

A $5 million endowment to operate the camp arrived through the help of Khaled Alhegelan, a 25-year-old Saudi businessman who lives in Washington. Alhegelan suffers from thalassemia, an inherited blood disorder. Since childhood he has had to be hospitalized every three weeks for blood transfusions, and he still remembers the pain and loneliness of his youth.

”Mr. Alhegelan remembered how it was important for him to get away from the hospital atmosphere,” Newman says. ”And it was important for me to hear him describe what it is like to face a life-threatening illness for 25 years. It was helpful to learn about the difficulty he had being fragile and feeling different.”

Five days after their initial meeting, a $5 million check, a gift from King Fahd and the people of Saudi Arabia, arrived. ”I never expected it,”

Newman says.

Fundraising continues (the camp is free to the children); financing is needed for long-term operating expenses, and Newman wants to winterize the camp so that in the off-season it can be used for meetings and seminars for parents of children with catastrophic diseases.

For a number of the kids, their stay at Newman`s camp may be the last carefree time as they fight a losing battle against disease. ”These kids are courageous beyond their years,” Newman says. ”But there`s not an ounce of self-pity. They don`t have time for it, which is something we`d all do well to remember.”

Although the facility is commonly known as ”Paul Newman`s camp,” the actor in general has shunned the limelight and generally kept his involvement on an organizational level.

”The trick of living,” he says, ”is to slip on and off the planet with the least fuss you can muster. I`m not a professional philanthropist, and I`m not running for sainthood. I just happen to think that in life we need to be a little like the farmer who puts back into the soil what he takes out.”

For information on applying to the camp, write: Hole In The Wall Gang Camp, 565 Ashford Center Rd., P.O. Box 156, Ashford, Conn. 06278; phone:

203-429-3444.