Add another economic development project to the list of items city commissioners will grapple with how to fund in 2009.

Commissioners at their meeting Tuesday evening told staff members to study a proposal that would have the city and the county partner to make $2 million in improvements to an industrial lot east of the East Hills Business Park.

But commissioners also expressed concern about whether the city can afford the project, which would add seven feet of fill dirt to an 87-acre tract just east of Noria Road near the East Hills Business Park.

“These investments are important, but we have to make sure we can afford them and that they make good economic sense,” City Commissioner Mike Amyx said.

City Manager David Corliss told commissioners that it would not be feasible for the city to use cash reserves to pay for the project, even assuming that the county would pick up half of the $2 million cost.

That means the city likely would have to issue bonds for the project. But the ability of the city to issue new bonds without raising property taxes also is becoming limited. City staff previously have estimated that the commission can issue $5 million a year in bonds without raising the property tax rate. But now that the city’s assessed valuation has become stagnant, it is possible that number could be shrinking.

Commissioners already have heard multiple requests for projects that would require issuing bonds, including more than $1 million worth of new fire equipment, and perhaps millions of dollars for improving the former Farmland Industries property.

The Noria Road property, owned by the nonprofit Douglas County Development Inc., is the only industrially zoned vacant site in the county more than 50 acres in size. DCDI leaders have said making the property more construction-ready is important because companies have been turned off by the length of time it would take to begin building at the site.