A project to convert the old Oak Bluffs library on lower Circuit avenue into a mixed-used building with affordable housing and a new pharmacy has become increasingly mired in confusion, as questions surface over management of the project and whether it should have been referred to the Martha’s Vineyard Commission for review as a development of regional impact (DRI).

The library project has received more than $800,000 in funding from a large state grant and a series of allotments from the town Community Preservation Act fund.

But accountability appears to be lacking on a number of fronts.

To begin with, extensive work has already been done on the building, although there are no site plans on file at the town hall, there is no general contractor and the project has not yet gone out to bid.

Added to that are questions about review by the commission.

The town wants to rehabilitate the 80-year-old, two-story, wood-frame building at the corner of Pennacook and Circuit avenues, and create a commercial space on the ground floor, likely a pharmacy, and three units of affordable housing on the second floor. The town plans to retain ownership of the building and execute a long-term lease and management contract with the Dukes County Regional Housing Authority.

The project has been spearheaded by selectman Ron DiOrio, who is also chairman of the town affordable housing committee.

In August of 2008, the town won a $445,654 grant from the Housing Development Support Program, which is administered by the state Department of Housing and Community Development, for the library conversion. At three separate town meetings between December of 2007 and the annual town meeting this month, voters have approved a total of $424,000 in Community Preservation Act funding for the project.

The plan was discussed at several selectmen’s meetings in 2007, and received mostly positive feedback. Architect Douglas Paul Ulwick of Ulwick Associates in Hanover was hired to do preliminary design work for $10,000. Final bids went out for design work and minutes show that in January of this year the affordable housing committee selected Durkee, Brown, Viveiros and Werenfels as architects for the project.

Meanwhile, work has begun on the building, which has been out of use as a library since the fall of 2005. The interior of the building has been gutted, the roof has been replaced and exterior siding has been stripped. The cost of the work was not immediately available.

But Paul Foley, DRI coordinator for the Martha’s Vineyard Commission, said this week that he notified the town building inspector’s office and zoning board of appeals by telephone that the project should have been referred to the commission.

Mr. Foley said there is little question that the project should have been referred to the commission for review. “I don’t go looking for projects that need to be referred, that is not part of my job,” Mr. Foley said. “But to answer the question, yes. The project qualifies for an automatic referral according to our checklist. That seems pretty clear,” he said.

Adam Wilson, the town zoning administrator, said he was not aware that any town board planned to refer the project.

Mr. DiOrio argued strenuously that the project does not need to be referred to the commission, because it is a town project that does not expand the footprint or increase the use of the building. He said it had already been reviewed by the Cottage City Historic Commission, selectmen and the building inspector.

He also said several public hearings have been held before the selectmen and the affordable housing committee.

“And don’t forget it has gone to town meeting on three occasions [for Community Preservation Act funding], and it has been approved by an overwhelming majority each time. This is a good project for the town; everyone will benefit. This town has needed a pharmacy for a long time . . . and we always need affordable housing,” Mr. DiOrio said.

He said work already done on the building is preliminary and did not go out to bid because town workers were used to save the town money.

The state uniform procurement law requires most public building projects to go out to bid. It is also unclear whether there are further rules and guidelines that accompany the state grant.

But Roger Wey, a retired selectman who is also director of the town council on aging, said this week that many people are less interested in the complexities of rules and guidelines and more interested in having an open public airing of the project. He suggested that a commission review might be not only in order, but a good thing.

“I know they want to finish this project as quickly as possible, that’s understandable, but why not stop and have a meeting? Better yet, just send it to the commission — what’s the worst that will happen? They will review it, people get a chance to give their opinions, and it might wind up a better project,” Mr. Wey said.