Lawrence city commissioners Tuesday used their new tax abatement policy for the first time, approving a 10-year, 55 percent tax abatement for Lawrence-based Prosoco to expand its East Hills Business Park warehouse.

The new policy, approved late last year, didn’t alleviate all the concerns commissioners have about tax abatements.

But it did spell out requirements a company must meet for approval, they said.

“I think the policy creates some criteria that are quite clear, and I think Prosoco has met them in every specific instance,” City Commissioner David Dunfield said.

Among the requirements: The average wage for new jobs created by the project must meet or exceed the average area wage of similar jobs.

In Prosoco’s case, the project will add an estimated seven new production jobs that are expected to pay $10 to $15 an hour, Bruce Boyer, company vice president, said. That compares favorably to an average area wage of $8.61 for production workers.

The policy also requires a project to produce at least $1.25 in benefits to the community for every $1 in costs the project creates for the community. According to a Kansas University study commissioned by the city, the project is expected to produce $2.01 in benefits for every $1 in costs.

City Commissioner Mike Rundle was the lone commissioner to vote against the abatement. He said he still was unconvinced by the need for the property tax abatements to attract projects like Prosoco’s.

“I believe we give tax abatements to get something we couldn’t get without the abatement,” Rundle said. “I just feel I can’t support the project because I feel the expansion will happen without it.”

The new policy, unlike the previous one, does not require commissioners to consider whether the project would happen without the abatement.

The current policy will require Prosoco to sign a performance agreement that essentially is a written promise from the company to hire the number of new employees, pay the wages and invest the amount of money it said it would in its abatement application.

Assistant city manager Dave Corliss said if the company does not live up to the agreement, city commissioners can reduce or the eliminate the abatement.

Prosoco, which currently employs 78 people, is the first company that will be required to sign a performance agreement. Boyer said his company didn’t object to the requirement.

“I don’t think any company committed to Lawrence is going to have a problem signing it,” Boyer said.

Boyer said the company, which produces cleaning solvents for brick and masonry products, hopes to begin work on the 55,000 square foot, $2.5 million expansion within the next month. Once construction is started, he estimated it would take four to six months to complete.

Boyer also said he thought the project would allow the company to add more than the seven employees he has projected. He said the expansion should allow the company to add a second shift of production workers, which could add another 10 to 15 employees.

“We think this is really a springboard that will let us do a lot of expansion in the future,” Boyer said.

The abatement is expected to save the company about $31,000 a year, based on current property tax rates.