Plans to rehabilitate the old Santa Fe Depot in East Lawrence will shrink in scope after Lawrence city commissioners were told state grant officials weren’t on board with all the proposed improvements.

Commissioners at their Tuesday evening meeting unanimously agreed to cut about $300,000 worth of improvements out of the rehabilitation plans for the depot at Seventh and New Jersey streets.

Commissioners made the cuts after state officials notified the city that several of the improvements were deemed ineligible for funding under a $1.2 million federal/state transportation grant the city had received last year.

The cuts include parking lot and sidewalk improvements on the east side of the building, and several interior improvements to the space that will continue to be used as offices for the Burlington Northern Santa Fe Railroad. City officials originally had been told the improvements were grant eligible, Assistant City Manager Diane Stoddard said. Commissioners were given the option of leaving the improvements in the project, but that would have increased the amount of local funds needed to about $650,000.

Commissioners were told that state officials expect the depot project to go out for bids in September.

In other news, commissioners:

• Agreed to accept an application for industrial revenue bonds for a proposed affordable senior housing project near 23rd and O’Connell streets. But commissioners said they were not interested in accepting an application for a 100 percent tax abatement for the proposed 90-unit development. The project is being proposed by an Olathe firm that would use state tax credit to build the units, which would be rent-controlled through a state program. The industrial revenue bonds, if approved, would give the developer a sales tax exemption on the purchase of construction materials.

• Referred for further study a proposal to lower the dollar threshold for tax abatement applications. Currently, a project must plan to invest at least $5 million in capital before it can apply for a city tax abatement. Commissioners want the city’s Public Incentive Review Committee and the Joint Economic Development Council to consider whether that threshold should be lowered to help smaller businesses.

• Received a presentation on proposed guidelines for when brick streets should be preserved or replaced with more conventional asphalt or concrete streets. Commissioners heard from the president of the Lawrence Preservation Alliance, who said his group still had questions on how the guidelines would be applied. Commissioners were told the guidelines will be presented to the Historic Resources Commission in the coming weeks, and then would be brought back to the City Commission for final consideration.