Lawrence city commissioners on Tuesday are poised to grant a 95 percent, 15-year tax rebate to The Eldridge Hotel for a planned expansion of the downtown landmark.

If approved, it will be the seventh time the city has used the Neighborhood Revitalization Act to issue a tax rebate in the past four years. All seven projects have something in common: They’ve all been more expensive than commissioners envisioned when they created the program in 2011.

The city in late 2011 created a policy that allowed tax rebates to be issued through a state NRA law. The policy, however, includes language that says “as a standard practice” the city won’t issue rebates for an amount more than 50 percent of the taxes due, or for a time period longer than 10 years.

Policy and reality haven’t matched. All six of the approved projects, and also the pending Eldridge project, have exceeded the 50 percent level. Three of the projects, counting the Eldridge project, have exceeded the 10-year provision.

“I think if we have been exceeding our policy that often, then we probably do need to go back and look at the policy and see if it is still a good policy or whether it needs to change with the times,” City Commissioner Jeremy Farmer said.

Farmer was among the majority of commissioners who last Tuesday voiced support for the proposed incentive package for The Eldridge, which developers have said is essential to a 54-room expansion of the historic hotel at Seventh and Massachusetts streets.

Farmer said the Eldridge project is a good example of how the city’s policy may not be well-suited for the current environment. He said the Eldridge project is a critical piece of redevelopment of a long-vacant lot downtown, and also will help preserve a historically significant building by making the current Eldridge property more financially viable. He said such intangibles likely make the project worthy of an abatement larger than the standard 50 percent called for in the policy.

He said intangibles also could be pointed to on several of the other tax rebate projects, which have included affordable housing projects in East Lawrence’s Warehouse Arts District, the rehabilitation of a historically significant home near the Douglas County Courthouse, and a large mixed-use apartment building near Kansas University’s Memorial Stadium.

“The intangible of affordable housing, the intangible of mixed-use development, the intangible of downtown redevelopment — you have to factor those in to your decision making,” Farmer said. “You have to figure out how important those are to the whole community.”

The city’s current policy, however, doesn’t provide any guidance on how those intangibles should be considered by the City Commission. It does give the commission the authority to deviate from the standard 50 percent rebate if members are convinced the project would not occur without the higher-than-normal tax rebate.

The ownership group of The Eldridge has presented figures that show the project has a very low rate of return, even with the financial incentives. The city, using numbers provided by the ownership group, has estimated that without incentives the $12.5 million expansion project would produce only a 0.02 percent rate of return over 15 years, likely making it unfeasible. With incentives it still only produces a 1.1 percent rate of return, the city estimates.

Those numbers likely will be challenged Tuesday. The Eldridge incentives package has become a hot-button issue among many of the 14 candidates for seats on the City Commission. Stuart Boley, a retired IRS agent who is running for a seat, said he’s raised concerns with city officials about their analysis, and plans to do so at Tuesday’s meeting.

“They’re basing decisions on a flawed analysis,” Boley said.

He said the rate of return being quoted by the city doesn’t reflect the true value of the expansion project. He said the city’s analysis doesn’t do enough to factor in how much the value of the existing Eldridge Hotel will increase once an expansion is added. If that calculation were made, Boley said he suspects the rate of return on the project would be significantly higher.

Commissioners are scheduled to vote on the incentives package at their 5:45 p.m. meeting Tuesday at City Hall.