BETHLEHEM, West Bank - It's Christmas season, and the little town of Bethlehem is jammed with a big-city problem: traffic snarling streets everywhere, including around the church marking the spot where tradition says Jesus was born. The city is considering a dramatic solution to the problem - digging a tunnel under Manger Square.

Traffic is a mess year-round. It may be the biblical town of grottos and shepherds' fields in the minds of many around the world, but Bethlehem is a modern, densely populated town of 28,000 with a dizzying weave of small streets that practically guarantee traffic jams.

"Bethlehem is going through a crisis," said Anton Salman, a city councilor. "We think that the solution to this traffic is to build an underground passage between the two sides of the square."

Bethlehem's municipality hopes to eventually build several tunnels around the Palestinian city, where the urban development problems are myriad. Bethlehem is sandwiched on three sides by other towns. From the north and southeast, it is hemmed in by Israel's separation barrier and Jewish settlements, leaving it little choice but to build vertically.

It is also a main transit point for drivers between the northern and southern parts of the West Bank, compounding its congestion.

The area around the Nativity Church, built atop the site where Christians believe Jesus was born, is particularly busy, with a mix of tourists swarming the area and cars squeezing across the central Manger Square. Streets all around face a constant backlog because of traffic in the square, where beeping horns are heard as much as clanging church bells.

Even worse, during the holidays, the square is closed for annual events like the Christmas tree lighting and Christmas Eve celebrations, when it is thronged with revelers. That plunges traffic nearby deeper into chaos.

The plan proposes a 260-foot-long tunnel passing under a narrow two-lane street that crosses Manger Square in front of the Nativity Church. The project would take about two years to complete and would cost $4 million to $5 million, with the Palestinian Authority pledging to foot the bill. If the plan is approved, construction could start next fall.