The Denali Commission, the recently embattled agency that was established under the late Sen. Ted Stevens, has again become so embattled that its own inspector general has recommended that the agency be shut down and that he himself be fired.

In a letter published in the Washington Post that the inspector general for the agency, Mike Marsh, sent to Congress and to the Post, Marsh said, “I recommend that Congress put its money elsewhere.”

The news has generated lots of headlines. The conservatives particularly love it. A federal bureaucrat recommending that the government fire him makes a good story, particularly as Congress dukes it out over the budget.

Marsh argues that the money spent is going to projects that villages are too small to sustain. In a previous report, he also alluded to the fact that federal dollars from the agency have gone “missing in action.”

The truth, however, is more complicated.

The Denali Commission acts as a coordinator for federal infrastructure dollars that go to rural Alaska. Money from the agency gets funneled to other agencies throughout the state to build projects like rural health clinics, energy infrastructure, and sewer and water systems.

At its apex, when Stevens was at his most powerful, the funding for the commission topped $150 million in 2006. Last year, the agency’s budget was just over $10 million. The commission is asking Congress for $14 million in the upcoming budget.

Inspector General Mike Marsh lives in Arizona. He’s an accountant and a former prosecutor. In his letter, he suggests that the commission be expanded to include Outside states, that it be turned into a nonprofit organization, that it be a cabinet department, or that it just go away.

The first commission members heard about Marsh’s recent pronouncement was in the newspaper on Friday morning. Marsh didn’t attend the last board meeting, in person or telephonically.

Joel Neimeyer, the top federal official at the agency described Marsh as funny, brilliant, and quirky, but he doesn’t agree that the agency should be shuttered.

Neimeyer said that Marsh is using his law enforcement skills to investigate what the agency has done wrong. In contrast, Neimeyer is an engineer. His job is to look to see what the agency needs to do to make things work.

“It’s two different ways of looking at life,” Neimeyer said.

Perhaps nowhere are these differences in approaches more telling than in Marsh’s report earlier this year about what’s called “renewal and replacement” accounts. In the report, Marsh made it sound as if millions, maybe as much as a $100 million federal dollars went “missing in action”, and he has used this as ammunition to advocate shutting the agency down.

Along with other requirements, renewal and replacement accounts, or R&R accounts, were supposed to be established as part of each project that received an energy infrastructure grant as one part of a business plan. They were accounts, paid for by the users of such facilities through fuel surcharges, that would help maintain equipment.

Such funds were not established for 32 of the 67 accounts audited by the commission. Other requirements of business plans were established.

According to a Denali Commission report about the funds, a total of about $6 million should have been in such accounts; but were not for various and complicated reasons, mostly due to lack of communication between the Denali Commission and the state agencies overseeing the projects.

“This one weakness in oversight does not detract from the totality of the Commission’s efforts,” the report says.

The main point however is that although there was confusion about the accounts, no federal dollars went “missing in action,” Neimeyer said.

In any case, the agency is going through an audit by the U.S. General Accountability Office, and Alaska’s congressional delegation is committed to the commission and will work to keep it alive.

Sen. Mark Begich, who is up for reelection in 2014, said “Alaskans want to keep the Denali Commission and I will continue to fight for it.”

Further, Sen. Lisa Murkowski has called for an audit of Marsh himself, who requested $330,720 last year and $292,653 in the current budget to keep his office running and to give himself a paycheck.

Contact Amanda Coyne at amandamcoyne@yahoo.com