AUGUSTA, Maine — The structure of the Maine State Housing Authority is ineffective and it focuses on the wrong issues, lawmakers were told Tuesday as they considered a bill to revamp the agency.

The Legislature’s Labor, Commerce, Research and Economic Development Committee took about three hours of testimony on LD 1778, a bill sponsored by Sen. Jon Courtney, R-Springvale. That bill proposes putting more authority into the hands of MaineHousing’s board of directors, including the power to fire the quasi-governmental agency’s executive director.

That post is now a four-year term and the governor can remove the executive director only for “inefficiency, neglect of duty or misconduct in office.” Unlike other quasi-governmental bodies, the board cannot fire the executive director.

MaineHousing has been in the center of an increasingly intense political debate as Treasurer Bruce Poliquin and new board members appointed by Gov. Paul LePage have sought to assert their influence over leadership at the agency. Last Friday, lawmakers voted to have the Legislature’s investigative arm look into MaineHousing’s expenses over the past five years related to memberships, contributions, travel and other expenses.

At Tuesday’s hearing, Sen. Christopher Rector, R-Thomaston, co-chairmanof the committee, cautioned those testifying that the bill concerned changes in governance at MaineHousing and that other issues weren’t germane to the hearing. Courtney, speaking on behalf of his bill, agreed.

“This issue is very emotional to some people but I think what we need to do transcends personalities,” said Courtney.

Courtney suggested his bill would promote stability, predictability and confidence at MaineHousing.

Peter Merrill, MaineHousing communicators director, spoke on behalf of the agency, testifying neither in support or in opposition of the bill. He made a number of recommendations on the bill.

He suggested that the board be given the power to both hire and to fire an executive director.

Courtney’s bill would have the governor continue to appoint the director, with power to fire resting with the board. He also suggested that the executive director only be fired for certain reasons and on a minimum vote of approval by six commissioners.

He, like others testifying, also suggested that board members serve staggered terms so they’re not all appointed at the same time or get off the board at the same time.

And he suggested that the bill’s sections dealing with the executive director only go into effect on Feb. 3, 2014 — which is when Executive Director Dale McCormick’s term is up.

“Taking people at their word that this is not about the current director, then it makes sense to have these changes take place at the end of the current term,” Merrill said. “It also addresses concerns that the firing of the director before the end of term could be considered a breach of contract.”

About a dozen people spoke in favor of the bill, with the common theme of a need to ensure public resources are appropriately used.

More checks and balances and overall oversight was needed at MaineHousing, said Pem Schaeffer, a Brunswick resident.

“The scale is too great to function without checks and balances. There are too many opportunities and temptations for using other people’s money,” said Schaeffer.

Well-known tax activist Mary Adams produced a 2004 report that had been commissioned by the Southern Maine Affordable Rental Housing Coalition that pointed out some of the same issues lawmakers are dealing with today. The report noted that the governance of MaineHousing was significantly different from similar agencies in other states. The director, it noted, is subject to “relatively little oversight or accountability.” The report suggested giving the board powers including to hire and fire the director.

“Why the Legislature never did anything about the cockamamie setup after this is beyond my comprehension,” said Adams.

John O’Dea, CEO of Associated General Contractors of Maine, said his group supported the bill because it has spent an “inordinate amount of time addressing issues with the Maine State Housing Authority.” Those included standards built into how the agency scored contracts, giving weight to green building plans, on-the-job training requirements and other standards that O’Dea referred to as “social engineering.”

“It appears as though the Maine State Housing Authority has been concerned with many things that go beyond the development of affordable housing,” O’Dea said.

O’Dea said his group supported greater accountability at MaineHousing. The report from 2004 demonstrates that the issue has been around for some time, O’Dea said, and is less about a political fight than has been portrayed in the media.

Several people spoke against the bill, including Rep. Ralph Chapman, D-Brooksville. Chapman, who said he works in the area of weatherization, pointed to the politicization of the Low Income Home Energy Assistance Program at the federal level.

“I would not like to see the politicization of the efforts of the Maine State Housing Authority to provide the very needed help for our low-income residents,” said Chapman.

In his testimony, Merrill said the autonomy of the executive director had been set up as such to avoid political pressure.

“The reason for the independence is to isolate us from too much political influence,” said Merrill. “We are obligated to bond holders and the people of Maine.”

It was unclear when the committee will take a vote on the bill.