Place the potatoes in a Dutch oven and cover with water. Bring to a boil. Reduce heat; cover and cook for 10-15 minutes or until tender.
Meanwhile, in a large skillet, cook bacon over medium heat until crisp. Using a slotted spoon, remove to paper towels; drain, reserving 2 tablespoons drippings. In the drippings, saute the onion and celery until tender. Add garlic; cook 1 minute longer.
Drain clams, reserving liquid; set clams aside. Drain potatoes and return to the pan. Add the onion mixture, bacon and reserved clam liquid. Stir in the water, tomato sauce, tomatoes, pepper and salt. Bring to a boil. Reduce heat; simmer, uncovered, for 30-35 minutes or until heated through. Add clams and parsley; simmer 5 minutes longer.