Pat Schooley, a member of the Washington County Historical Advisory Committee, said the aging building on the Red Barron property could be used for the new store, among other possible uses.
Schooley said McDonald's restaurants have sometimes been located in old buildings.
An attorney involved in the new Sheetz could not be reached for comment after the meeting, but Williamsport Town Clerk Donnie Stotlemyer said developers of the project have said in meetings that the building will be torn down.
Schooley said the building, which was built about 1820, is also referred to as the Potomac House. Over the years, it was used as a hosiery mill and an overall factory, among other uses, Schooley said.
Rather than tearing it down, Schooley said the two-story brick building could be a part of Williamsport's gateway into its historical district which the town is trying to promote.
Schooley said the developers who want to tear down the building could get tax breaks that could offset more than 40 percent of the cost of rehabilitating the cost of the building.
Although Schooley told council members that "you have power, you have rights," Mayor James G. McCleaf II said after the meeting that the council does not have any say over the razing of the building.
The only decision the town has in the process is whether to abandon part of an alley on the property, McCleaf said.
"I appreciate you coming in and saying what you're saying," town Councilwoman Maya Haines said.
Sheetz is proposing to replace an existing store at Artizan and Potomac streets with a new one.
Project officials have said previously that the new store would be about 4,056 square feet and located at the rear portion of the Red Barron property.
The property has been vacant for several years, despite previous attempts to develop it, according to the plans for the new Sheetz.
In 2009, Washington County Circuit Judge W. Kennedy Boone III issued an order upholding a zoning decision that allows a new Sheetz.
Boone dismissed an appeal by a group of 45 Williamsport residents and property owners who argued the town's zoning ordinance prohibits the sale of petroleum products in the Town Center district.
Opponents were concerned the new Sheetz would bring more traffic, noise and pollution to the downtown area and detract from the historic homes around it.