A $2 million project to convert a vacant downtown building into the new headquarters of a Lawrence architecture firm won a key tax break from Lawrence city commissioners Tuesday.

Commissioners at their weekly meeting agreed to provide a tax rebate to Treanor Architects for a project it is planning for the former Strong’s Office Supply building at 1040 Vt.

“What we have here is a dilapidated building in downtown,” City Commissioner Aron Cromwell said. “We don’t have many of those, but this is one, and we need to work to take care of it.”

The city agreed to use the Neighborhood Revitalization Act, which will allow Treanor to receive a rebate on a portion of the new property taxes that will be generated by the project. The city, county and school district will continue to receive all the taxes they currently receive from the property. But as the project is built and the tax bill rises, Treanor will receive a rebate for the next 10 years.

The rebate will start at 95 percent in 2012 and gradually fall to 20 percent by 2021. After 2021, the project will not receive a rebate.

The tax rebate did draw an objection from one member of the public. Jim Mullins, a Lawrence resident and field director for Americans for Prosperity, said he questioned whether the city was properly using the Neighborhood Revitalization Act.

“The state gave us this tool to clean up shabby or blighted neighborhoods,” Mullins said. “Not to help a developer get a tax break without adding one new job to the community.”

Mullins objected to the fact that the rebate was being offered even though Treanor is proposing only to move employees from two existing offices in Lawrence to downtown.

But commissioners said bringing more employees to downtown is an important way to strengthen the overall health of downtown.

Commissioners, however, delayed a decision on another part of the project. Commissioners said they wanted more information from city staff about the downtown parking system before agreeing to convert a two-hour city parking lot into a 10-hour lot near the 1040 Vt. site. Treanor is asking for the lot to be converted to a 10-hour time limit to accommodate employees. The company also is asking to buy 50 long-term parking passes from the city for $195 each, with assurances that the price of the permits won’t increase for at least 10 years.

The newly elected City Commission is expected to hear the parking issue at its meeting April 19. The Douglas County Commission and the Lawrence school board each will have to consider whether they want to be part of the tax rebate program. Both are expected to take up the issue later this month.