The Rocky Mountain High Intensity Drug-Trafficking Area program administers the grant and found during a 2011 audit that the spending didn't meet program criteria.
The money wasn't used for major drug trafficking or drug dealer investigations as the program requires, and the West Valley City voluntarily returned the money last year, said program director Tom Gorman.
Susan Powell of West Valley City vanished in December 2009 and has never been found. Her husband, Josh, was a focus of the investigation until he killed himself and the couple's two children in an explosion last year at a Washington home.
The Salt Lake Tribune first reported (http://bit.ly/13KcX23) the returned money Friday.
West Valley City Deputy Police Chief Mike Powell, who is unrelated to the missing woman, told The Associated Press that investigators explored a possible connection to drugs and Powell's disappearance.
"There was a nexus that was developed to controlled substances that may have played a role," he said.
Mike Powell said he could not offer further details on what role drugs might have played.
He said that while the audit found the costs did not meet criteria, it did find the spending "reasonable" and "justified."
Gorman said he didn't know the details about how the city found a drug tie-in to the Powell case beyond it involving the potential of prescription drugs playing a role.
The investigation into Susan Powell's disappearance is ongoing.
The money West Valley City returned represents only part of the funds the department receives under the grant and a fraction of total amount the city has spent investigating Powell's disappearance.