Bethlehem's Alley House Program gets $850,000 to address affordable housing crisis

BETHLEHEM, Pa. — Bethlehem, Lehigh University, Community Action Lehigh Valley and New Bethany can continue working toward addressing the city's affordable housing crisis thanks to new funding.

The Transportation, Housing and Urban Development and Related Agencies Appropriations Bill awarded The Alley House program in Bethlehem $850,000 to create a demonstration and "continue their work on a proof of concept," a news release said.

The program would build modular alley houses through a pilot program — including incentives for participating homeowners to bring in rental income for homes on their lot.

It would start on the West Side and move beyond at some point. The grant would be used to help fund three or four alley houses initially.

The city’s current zoning ordinance doesn’t allow for accessory dwelling units on any parcels without an approved variance.

The idea has drawn support from city officials, and raised concerns among residents.

"The city is interested in encouraging gentle increases of neighborhood-compatible density and encouraging different types of housing development," Sara Satullo, Bethlehem's deputy director of community development, previously said.

The funding comes as the city continues efforts to address its housing issue — a housing needs assessment found 2% of rentals in Bethlehem are vacant.

That level indicates "a severe lack of available housing," the release said. "And Bethlehem, like other cities across the region, has limited vacant land for large-scale development, complicating efforts to build multi-family affordable housing."

The Alley House program calls itself "a historic housing type rooted in the traditions of Bethlehem."

There are alley homes all across Bethlehem, including the South Side at Morton and Laufer streets, as well as the West Side at Franklin Alley and Raspberry Street, proponents have said.

Project officials have identified about 650 parcels in West Bethlehem that could “reasonably accommodate” the program’s alley houses, flagging lots at a minimum of 20 feet wide by 140 feet long.

That side of town was chosen because of the current presence of accessory dwelling units and often larger lot sizes compared with other areas of the city.

Also in the release, U.S. Rep. Susan Wild, D-Lehigh Valley, who was described as "instrumental in championing the program," said she looks forward to seeing the impact the project could have on the Lehigh Valley.

“Every Pennsylvanian should be able to count on safe, affordable, high-quality housing,” Wild said in the release. “I have said that from my first day in Congress — and I am thrilled that this groundbreaking funding will get our community closer to that goal."

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