Amid ongoing financial problems in Oak Bluffs, a group of town business leaders has proposed moving the police department from its current headquarters on the corner of Ocean and Lake avenues so the building can be rented out to a retail operation.

At the selectmen’s meeting last week, members of the community development committee pitched the idea as a way to generate revenue for the town. The community development committee is appointed by the selectmen and charged with promoting economic development.

In 2005 selectmen voted to move the police department to its current location, based largely on the recommendation from the community development committee. The building formerly served as the town hall, but was vacated in 2000 after persistent problems with air quality were making employees sick.

The police moved into the building after old rugs were removed, windows replaced and an industrial cleaning took place to eliminate mold and mildew. A new round of air quality tests came up clean.

But committee member Terry Appenzellar said last week that arrangement was meant to be temporary.

“We just want to remind you that the location we are talking about is zoned B-1, and we don’t get income from this property, which is a shame because it’s in the middle of the commercial district,” Ms. Appenzellar said. “It would also be a great part of the waterfront revitalization effort going on right now.”

The committee wants permission from selectmen to apply for a rural business grant from the U.S. Department of Agriculture to study the area and determine the best location for the police department and the benefits of returning the building to the commercial district.

Selectman Gail Barmakian, in her first meeting, questioned the plan.

“Do we know the cost of moving the police station . . . and if you pursue a planning grant does that mean the decision to move the police station is a fait accompli?” she said.

Ms. Apenzellar said the idea is still in the conceptual stage. “We have talked to Chief [Eric] Blake informally, and I believe his point to us has been: if [the department] has an appropriate space he is happy with what building the town feels he should be working out of. I don’t think he is wedded to that particular location. I think he is wedded to the idea of a decent building with good operating space for the staff.”

Selectman Gregory Coogan said the idea is not new.

“This predates the police department moving into that building. We asked the [committee] to look into how we could use what was essentially an abandoned building at the time. They said moving the police department in there was the most cost effective move . . . but we are still looking at whether this is the right place for the police department, or if it would be better suited as something else,” he said.

Selectmen voted to authorize the committee to pursue the rural grant.

Chief Blake said after the meeting that the key question is where would the police go.

“What needs to be vetted is where will the money come from to relocate us to a location of equal accommodations,” he said.