Salt Lake City will establish new guidelines for distributing money to private groups following an audit released last week questioning more than $20,000 in city money spent by the sports promotion agency, Better Utah Inc.

The city will sign contracts or establish spending policy with organizations seeking money through the city's Municipal Affairs program, which budgets $1 million to give to various non-profit groups, Finance Director Lance Bateman said.Better Utah Inc., the Salt Lake Chamber of Commerce, the Salt Lake Arts Council and other non-profit groups currently receive funding from the city under the Municipal Affairs program.

Contracts with such organizations will hold groups to a strict budget with the city. Organizations under contract will be reimbursed only for the exact expenditures shown on budgets established during the city's budget process, which begins in February, Bateman said.

Organizations under a spending policy will be given leeway permitting them some flexibility in meeting their goals but still must show they are spending money on what they said they would spend it on, Bateman said

"What we've got to do is establish that they're doing with the funds what they said they would," Bateman said.

A city audit released last week found that the non-profit Better Utah Inc. and its director, David Johnson, had double billed the city and the state for expenditures incurred while promoting amateur sports in Utah.

The audit found the company could not document that it spent city funds on what they told the city it would.

City officials, however, now say Better Utah Inc. ultimately spent the money on promoting amateur athletics in Utah. And since the company was spending money on sports promotion, the city is not requiring Better Utah to reimburse them for the $20,000.

Bateman has been "scrutinizing" organizations receiving city funds under the Municipal Affairs program since Mayor Palmer DePaulis announced last week the city would be closely monitoring how its Municipal Affairs funds were spent.

No other irregularities like those discovered last week in an audit of Better Utah Inc. have been discovered, he said.