A bill with the unenlightening title of “An Act to Provide for the 1999 and 2000 Allocations of the State Ceiling on Private Activity Bonds” is actually a chance for the Legislature to take an overdue look into the competitive and, apparently, profitable world of state-backed student loans. Its first goal is to return the competition to the loan business.

Recent news stories around Maine Education Services, which holds $500 million in Maine student loans, have focused on the salaries of its president, Richard Pierce, and his wife, Scottie Higgins. Though the salaries are high, they aren’t the point. The more important questions are how well does MES serve students through two quasi state agencies — the Maine Educational Loan Authority and the Maine Educational Loan Marketing Corp — and how well will students be served in the future. The fact that Mr. Pierce oversees these two agencies and MES and a related for-profit entity called Maine Educational Learning Systems means that lawmakers must be scrupulous in ensuring that a market exists in more than name for competition.

The King administration has been cautious on this issue, and not only because the board of MES contains a ring full of state political heavyweights. This is a complicated subject made more difficult by Maine’s need to expand access to higher education. That’s why keeping the public’s trust is important and why an amendment to the bill being heard today before the Committee on Business and Economic Development is essential. The amendment would require recipients of the tax-exempt bonds covered by this legislation to file a report on how savings from the state subsidy is passed through to Maine residents.

There is good reason for the public to be interested in these numbers. For instance, the MES SuperLoan is among the most popular in the state. Private lending institutions, however, offer what they call The Maine Advantage education loan, which according to state Treasurer Dale McCormick, is at least as beneficial for students as the government-aided SuperLoan. How can private businesses do that, or, conversely, why isn’t the government-aided loan more beneficial? Another question: If there is no additional benefit from state involvement, quasi or otherwise, why is it involved?

MES currently controls approximately 70 percent of the student loan market in Maine, yet state officials profess to know very little about the relationship of MES and the operations under its umbrella. That’s not just unfortunate, it’s wrong. If the Legislature doesn’t oversee how state-backed loans are being distributed, no one will. Treasurer McCormick recently asked the basic question of where the Maine Educational Loan Authority was given the ability to originate loans. No one seems to know.

The Legislature has its hands full with this legislation. It cannot expect to answer in the next few weeks the entire pile of questions it has been ignoring for years, but it can take some basic steps to clear up confusion around the issue.

First, it can ensure that private lending institutions are allowed a portion of the state’s loaning advantage by removing the allocation from the two quasi state agencies under MES and leaving it with a third party — one proposal calls for that party to be the Finance Authority of Maine. MES, at some level, competes with banks and credit unions for this allocation, so it only makes sense to let some other organization decide which lender ought to receive it. FAME works with all lenders in the state but is not a lender itself.

Second, lawmakers can open these processes to public scrutiny by requiring lenders to show how borrowers would benefit. This is essential, because it justifies the entire program’s existence. Any lender that cannot show a specific benefit essentially refutes the need for the state’s participation.

Third, the Business and Economic Development Commitee can establish a broad review of the student-loan processes in Maine. The large amount of time it has devoted to this issue is commendable, but it has raised at least as many questions as it has answered.

A task force charged with fully investigating the current setup not only helps build public trust but discourages the state from making the same mistakes in the future.