The City of Bethlehem Comments on the Bethlehem Co-Op Boondoggle

— Editor’s note: This story uses a slang term for wasting government money several times. Readers who may be offended are warned.

Sept. 30, 2025

— Jeff Ward, Lehigh Valley News Briefs

The City of Bethlehem has given the Bethlehem Co-Op Boondoggle $105,000 and was the custodian of $2.9 million in federal dollars that went to this non-existent food store at 250 E. Broad St.

I’ve been asking city officials for some time to comment on the Boondoggle, which started taking shape in 2011 and has set various opening dates and blown past them all.

This boondoggle is notable because if it ever does open and make money, the profits won’t go back to the taxpayers. They’ll go to “member-owners” whose membership fees are a little over $500,000, about a sixth of what taxpayers involuntarily invested.

Meanwhile, the boondoggle says it needs another $1 million so if it opens, it can stay open.

This isn’t a small grocery store. It’s a fundraising operation that publishes recipes on its website. Some of them look pretty good, but are they worth $3 million?

I do wish to thank Laura Collins, director of community and economic development for the city, for responding on behalf of the administration of Mayor J. William Reynolds. She responded to my request for information on what the city is doing about the boondoggle (I have now used the word “boondoggle” seven times).

I have also talked with City Controller George Yasso and received three responses from City Council. I have not heard back from state Sen. Lisa Boscola, D-Bethlehem, who secured a $100,000 Pennsylvania grant for the boondoggle (eight times now). More on that later.

From Collins:

Hi Jeff,

Thanks for giving me a couple days to follow up on your inquiry to the Mayor, Controller, and City Council about the Bethlehem Food Co-Op. As you can imagine, with all the good things going on in the City of Bethlehem, I sometimes have a full schedule that makes it difficult for me to respond right away to all inquiries. But I can assure you that it was no one’s intent to leave you without a response. And this topic is an important one for us as well as the city’s residents and Co-Op members, so I wanted to make sure I got you a thoughtful answer.

First, I believe the Controller assured you yesterday, as I will now also, that the City has accounted for all of the federal grant dollars that passed through the City to the Co-Op. We know where the money has gone, and so does the federal government.

With respect to the project’s overall timeline and costs, the Co-Op leadership is best positioned to explain what occurred over the past several years. What I can say is that part of the reason, in our view, that things have seemed to take so long is actually because there is so much oversight associated with federal grants. While one might think a large federal grant is simply awarded and then handed over in a lump sum to the grantee without any further thought, that is far from the case. Like some members of the public, the Co-Op leadership may not have understood the scope and complexity of the federal grant process when they started the project and first set an opening date. As the project has progressed, we have helped level set their expectations about federal grant processes, including understanding that the grant is a reimbursement grant (so they needed to have cash on hand to make expenditures before drawing down on grant funds) and that each draw request must be accompanied by detailed accounting of how and where money was spent and a demonstration that the money was spent on budget line items that were already pre-approved by the federal government as eligible expenses within the scope of the grant. Both the City and the federal government review draw request justification records before authorizing disbursement of any funds, and the Co-Op’s federal compliance advisor served as a first check on compliance when preparing the draw request materials. All of the regulations and compliance matters can slow down a project, which is generally true anytime state and especially federal funds are involved, whether that is for a public sector project or a private sector project of any type.

The Co-Op has also explained that the project’s overall timeline and costs have been impacted by market forces like rising construction costs and supply chain challenges, which is consistent with what we have heard from other developers of construction projects in the area in recent years. But, for specific details on how those factors and others have or have not impacted the overall project timeline and costs, I would defer to the Co-Op leadership.

At this point, we are strongly encouraging the Co-Op to set an opening date because they are confident they can open in the near future and it is important to their thousand+ members that they know this is going to happen.

*****

Thanks again to Collins for the above. Among other things, she confirms that the Boondoggle (nime times now) sought a grant and didn’t know how to handle it.

Meanwhile, the Boondoggle (10) will hold its annual meeting Oct. 6. I’m going to ask to be allowed to listen. We will see if the boondoggle (11 times) responds.

After taking more than $3 million from the public for this boondoggle (an even dozen), they owe us something.

More on the boondoggle (a baker’s dozen) later.

— Disclosure: I too own a grocery store, a small part of one, via shares in Weis Markets (NYSE:WMK). The stock hasn’t done much, but at least Weis is not a boondoggle (oops, I did it again!)