Father Loftus was the catalyst for the establishment of a mission church in Bethlehem. According to 250 Years of the First Church in Bethlehem by Marshall Linden, Father Loftus first attempted to purchase the Methodist Episcopal Church building when its membership decreased, but the Methodists declined to sell it. In September 1915, land and a building on East Street previously used as a pool hall and confectionery were purchased from Edward Crane. Structural changes were made and in July 1916, this small building, newly named "Church of the Nativity", replaced Memorial Hall as the site for Catholic worship in Bethlehem. Mass was celebrated every Sunday from June through October, but only once a month from November to May, and many current parishioners traveled over wintry roads to fulfill their Sunday obligation in Woodbury or Watertown. Father Loftus himself made the long trip from Watertown to Bethlehem up Magnolia Hill in his horse drawn buggy.
Both Woodbury and Bethlehem continued as missions of Watertown under the guidance of Rev. Loftus, who was also responsible for the Catholic community in Middlebury. St. John of the Cross church was completed in Middlebury in 1914. On March 1, 1916, the churches in Middlebury and Woodbury were separated from Watertown and established as a separate parish. The first priest of the new parish was Rev. William J. Judge. The pastor lived at first in a rented house in Woodbury. The Catholic community in Woodbury at that time numbered 85 with a Sunday School attendance of 35. In July 1917, a house at 8 High Street (now Mountain Road) was purchased to serve as the rectory.
In 1922, Father Loftus retired from his ministry in Watertown, choosing instead to work as a missionary among the growing black Catholic population in Alabama. Father William Judge was transferred from the Woodbury/Middlebury parish, and appointed pastor of St. John the Evangelist in 1922. When visiting Bethlehem in good weather, he replaced his horse and buggy with a Stutz Bearcat. A parishioner recalls Father Judge's coming to Bethlehem to pick up candidates who were to receive their First Communion and Confirmation in Watertown - each with two ribbons and two pairs of shoes: a white ribbon for Communion and a red ribbon for Confirmation, one pair of shoes for the church services and another for the long walk home afterwards.