BETHLEHEM, Pa. — The Bethlehem Co-Op Market has pushed back its opening date again, citing new construction complications — as some residents continue to question how the nonprofit has spent millions in public dollars.
Outgoing board chair Domenic Breininger said the co-op, which first announced plans to open in 2022, no longer expects to open in 2025 due to a newly discovered construction issue involving the store’s refrigeration system.
“With our latest construction issue, we don’t believe [opening in 2025] is realistic anymore, and that’s extremely unfortunate,” Breininger said. “The refrigeration equipment requires a specialty subcontractor to connect the coolants to the rooftop system and there aren’t many of those contractors available.”
Breininger said the board is reviewing proposals and waiting on a schedule from the subcontractor before announcing a revised timeline. Once that work is complete, the co-op can obtain its certificate of occupancy — required before installing equipment, stocking shelves and holding a soft opening.
Millions spent, questions remain
Founded in 2011, the co-op aims to open a community-owned grocery store at 250 E. Broad St. in Bethlehem’s Northside Alive neighborhood, considered a food desert. Anyone can shop there, but members pay a one-time $300 fee to receive discounts, voting rights and shared ownership in the store.
The co-op has raised more than $4.5 million through public funding, private donations and member loans. That includes a $2.9 million federal grant secured by U.S. Rep. Susan Wild in 2021 and $100,000 from state Sen. Lisa Boscola’s office. Breininger said pandemic delays and post-pandemic inflation pushed project costs far beyond initial estimates.
“Before the pandemic, the project was expected to cost just under $3 million,” Breininger said. “But after COVID, equipment prices doubled in some cases. We renegotiated contracts and changed suppliers to cut about $800,000 in costs, but it’s been a challenge.”
Breininger said the co-op’s federal funds have been spent appropriately under U.S. Department of Housing and Urban Development (HUD) oversight. The city acts as the pass-through agency for reimbursements and monitors expenditures.
“We submit documentation regularly for audits,” he said. “We’re now conducting a full independent audit as part of HUD’s requirements.”
The co-op’s audit results are not public. Breininger said outside stakeholders would need to approve any release of the full report. He said the board intends to share an overview of the findings with members and the community, but has not committed to making the complete audit public.
The co-op’s latest financial update, shared in a newsletter, shows that it has about $233,000 remaining and has exhausted most of its federal grant. Its “Sustainable Future” campaign, a two-phase fundraising effort, has met its initial $600,000 goal to open the store and is seeking another $1 million to cover operating costs during its first year.
Residents call for accountability
Jeff Ward, a former journalist and Bethlehem resident, has been a persistent critic of the co-op’s use of public money, publishing a series of blog posts calling for audits and city oversight.
“My interest in the co-op increased when it started receiving public money,” Ward said. “Media reports would note the delays without sufficient skepticism. I went after the story because nobody else would.”
Ward said the co-op’s federal and state grants represent a “private waste of public money” and argues that city officials have not demanded enough accountability.
“The people who approved the spending and actually spent the money owe the public an explanation and an apology,” Ward said. “Millions of public dollars have flowed to an organization that has repeatedly broken its promises.”
“What is the city doing regarding tax dollars present to support the Bethlehem co-op fiasco,” Bethlehem resident Mary Jo Makoul said at a City Council meeting. “The money could have and should have been allocated to address the homeless issue.”
City officials, however, maintain that the co-op has complied with federal reporting standards. Laura Collins, Bethlehem’s director of community and economic development, said at a recent City Council meeting that funds are only reimbursed after the co-op submits invoices and documentation.
“There are very robust checks and balances on how that money is spent,” Collins said. “The city cannot redirect those funds to other purposes, such as homelessness, because they are federally earmarked.”
City urging transparency
Mayor J. William Reynolds said the co-op has faced legitimate post-pandemic challenges, but urged its leaders to communicate more clearly with the community.
“This has been a project that has gotten a lot of public funding, and also a lot of money from people within the community,” Reynolds said. “They need to set a date to open their grocery store, be honest about the challenges and tell people what they need to make this project happen.”
Breininger said the board has tried to increase transparency through open monthly meetings, public tours (currently on hold) and biweekly newsletters.
“We understand the questions and are more than happy to answer them,” he said. “This is a community project, and we want people to be part of it.”
The co-op holds public board meetings on the third Monday of each month at the Fowler Center, with a virtual option available.
Despite the latest setback, Breininger said he and the co-op’s 1,700 members remain optimistic.
“No one wants to get this open more than the small handful of volunteers who’ve been pushing hard on this project for years,” he said. “We’re eager to get the doors open for the community.”
