NORTHAMPTON — A city human service agency has agreed to reimburse the state for executive director salary payments and alcohol purchases following a state audit released this week.

The audit on Nonotuck Resource Associates, Inc. for the period between July 1, 2013 and June 30, 2015, released Tuesday by State Auditor Suzanne Bump, makes three findings on the agency that depends on state funding.

The findings conclude that Nonotuck:

Didn’t have “written, signed and/or current contracts for five consultants;”

Failed to maintain certain documentation, such as evaluations, contracts and confidentiality forms, in personnel files;

Charged $4,304 worth of nonreimbursable costs against state contracts, including $3,916 for the salary of Executive Director and CEO George Fleischner, and $388 for alcohol.

As a result of the audit, Nonotuck has implemented better procedures for handling its contract and various documents.

Fleischner said in an email Thursday that he is proud of the results of the audit for the agency that was founded in 1972 to serve people with intellectual and physical disabilities.

“They looked at all our systems and audited over $46 million of revenue,” Fleischner said. “What they found was two simple paperwork issues that we cleaned up immediately, and $4,000 of non-reimbursable billing.”

Nonotuck oversees shared living, adult foster care and day services in the city, as well as other locations in Boston, Pittsfield and Brockton.

The audit was done, according to the report, for “ongoing efforts to audit human-service contracting activity by state agencies and to promote accountability, transparency and cost-effectiveness in state contracting.”

Nonotuck in fiscal 2014 received $21.4 million in funding from sources including both Medicaid direct payments and through a subcontract with the Massachusetts Behavioral Health Partnership, the Department of Developmental Services and the Department of Mental Health. This increased to $24.7 million in fiscal 2015.

Michael Wessler, a spokesman for the state auditor’s office, said a series of factors led to Nonotuck being selected for the audit.

“Some of the criteria includes the last time they underwent a state audit, which was 1993, and the amount of state funding they receive,” Wessler said. “Our audit staff looks at these cumulative factors when determining entities to audit.”

New procedures

The audit revealed that Nonotuck paid five consultants $236,669 for marketing, legal, computer and client services. But it didn’t execute written contracts with two of these consultants, and the contracts with the other three either were not signed by both sides or had expired. To fix this problem, Nonotuck has agreed to create a written policy and procedures before it enters into contracts.

The audit showed that various documents existed but were housed at satellite offices. To remedy this, Nonotuck will put in place new internal procedures to ensure caregiver documents are housed in Northampton.

Meanwhile, Nonotuck has paid the state back for the more than $4,000 in nonreimbursable expenses, money which auditors said “could have been used by the state agencies that contract with Nonotuck to pay for program-related expenses for needy citizens.”

Fleischner said in the email that the corrections allow the agency to move forward with its work on behalf of more than 800 individuals.

“We are a state-wide, hard-working not for profit that’s transparent and clean,” Fleischner said. “No exotic trips, no expense lunches, no cars no funny business. Straight up services to people in need.

Scott Merzbach can be reached at smerzbach@gazettenet.com.

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