Four-County Community Services board of directors said it will abide by recommendations in a recent state audit that accuses the agency of mismanagement.

The board voted on a plan of action Tuesday night following a two-hour closed session. The 30 or so members met at the Bladen County Courthouse in Elizabethtown to discuss recommended changes to Four-County’s bylaws.

The changes are in response to audit by the state Department of Health and Human Services. The board already fired Executive Director Richard Greene, who was found in the Jan. 25 audit to have used a company-owned vehicle to tow his boat to fishing tournaments and to have concealed his marriage to Four-County fiscal director Annie Rothwell, among other allegations.

The DHHS audit investigated 18 allegations in total and found 15 to be substantiated, finding that the agency misspent nearly $75,000 during the 2012 fiscal year and that other monies appear to have been misspent since fiscal 2009.

The audit blamed much of the problem on Four-County’s lack of proper procedures.

“The mismanagement/misuse of state or federal resources was a direct result of the failure of FCCS management to develop and enforce internal controls that could have prevented the mismanagement/misuse from occurring,” the audit said. “Additionally, FCCS failed to enforce its conflict of interest and nepotism policies. As a result, inappropriate business relationships developed between FCCS staff and various vendors along with inappropriate reporting/supervisory employment situations.”

Last week, the Four-County board’s team of three Raleigh attorneys presented a drafted response to the audit’s allegations and recommendations, that the board reviewed Tuesday night. The state has given Four-county until March 25 to respond.

“We amended our polices to reflect the changes recommended by the Department of Health and Human Services and we approved every one of them,” said John Alford, who serves on the board.

The recommendations made in the audit include:

— The FCCS board of directors should either require the executive director to maintain a travel log for his assigned vehicle in accordance with FCCS policies or formally adopt and approve an exemption from FCCS policies. The exemption should also clearly specify whether the executive director may also use the assigned vehicle for personal/non-business activities.

— To strengthen internal controls, the FCCS board should review and approve all contracts with vendors doing business with FCCS to ensure that there are no conflict of interest situations and the contracts have been competitively bid and awarded in accordance with FCCS policies.

— To avoid any future confusion regarding the total amount of the executive director’s annual retirement contribution, the FCCS board of directors should review, discuss and vote on the annual supplemental retirement benefits for the executive director.

— To minimize any appearance of inappropriate payments (“regular compensation”) to board members, the FCCS board of directors should either revise the FCCS Bylaws and the FCCS Administrative Policies and Procedures Manual to allow payments (regular compensation) to board members or stop the payments in accordance with their policies and bylaws.

— The FCCS board should ensure all financial relationships with various other agencies have been approved and clearly documented to avoid the appearance of impropriety and/or misuse of State/Federal resources. Contracts should be clearly written to reflect the financial terms of the agreement between the respective parties.

The Four-County is also expected to repay $280,000 that was spent on unallowed employee raises and retirement bonuses. In 2010, the Office of Economic Opportunity, which administers Community Services Block Grant funds, performed a fiscal review of Four-County and found that more than $300,000 of those program funds had been misspent on employee bonuses.

In July 2012, DHHS told Four-County to repay $292,000, which has yet to happen.

Alford said that Four-County recently reached a settlement with DHHS, and will repay $282,000 when DHHS sets a payment deadline.

Four-County administers 16 Head Start programs as well as housing and weatherization assistance in Scotland, Robeson, Hoke, Bladen, Brunswick, Columbus, and Pender counties.