Maricopa County officials believe the discovery of a duplicate payroll log and database hidden in a secure computer system at the Sheriff's Office could reveal the extent of alleged misspending in Sheriff Joe Arpaio's agency.

The sheriff's employee database operated parallel to a county-run system, recording a different set of sheriff's staff assignments and payments than official records provided to county auditors. County officials say the system has existed since the early part of the decade, but they learned of it only recently through paperwork produced in a case alleging racial profiling against the Sheriff's Office.

Details of the sheriff's employee database and steps taken to investigate will be outlined to county supervisors at a hearing this morning.

The supervisors plan to subpoena 20 to 30 people to testify in the future about the hidden database, which is housed in a computer system at the center of a costly legal battle between Arpaio and the supervisors.

County administrators believe the Sheriff's Office intentionally misappropriated as much as $80 million designated for jail operations over five years to pay employees working in patrol, human-smuggling operations and investigative units. Those employees should have been paid with other funds, but county officials suspect the Sheriff's Office tried to maintain staffing levels by using money that legally was inaccessible.

The voter-approved jail-detention funds were established more than a decade ago with a sales tax of one-fifth cent per dollar to build and operate jail facilities.

If proven, the misappropriation of funds could lead to criminal charges. County Manager David Smith has called for an investigation by various agencies led by the U.S. Department of Justice.

A spokesman for the Sheriff's Office denied any intent to deceive county administrators. He blamed the confusion on a lack of compatible technology between the Sheriff's Office and other county agencies.

Some experts also have criticized county supervisors for not closely scrutinizing Sheriff's Office finances earlier.

County officials believe the Sheriff's Office used the payroll system, along with other spreadsheets and databases, to monitor work assignments but did not update the changes to the county's official payroll system. As many as 30 percent of employees were paid out of the wrong funds, they say.

Although the sheriff has wide discretion over how his agency's funds are spent, the board has responsibility to oversee all county spending and to ensure that it complies with state law.

The failure to maintain oversight of which funds were being used to pay employees has led to allegations that as much as $16 million a year in restricted detention funds was improperly spent.

The detention funds were approved by voters to be used only for jail operations. If the Sheriff's Office is found to have spent the money on patrol, immigration sweeps, administrative costs or other expenses, county officials believe the money legally would require repayment.

Attorney Tom Irvine, who represents the supervisors, suggested the county could crack down on sheriff's expenses to squeeze the money out of the sheriff's budget.

County officials are poring over records to determine how far back the alleged misspending of detention funds occurred. They suggest it could stretch five years or more and total as much as $80 million, although sheriff's staff dispute the figures.

County officials have a document in which Arpaio's chief financial officer, Loretta Barkell, estimates the figure to be $34 million, excluding overtime costs.

County budget and computer experts obtained data last week from the payroll system, known as PHReD, which was created in the early 2000s by a county programmer who has since died.

The custom-made system tracks employee salaries, job assignments, promotions, salaries and how the agency's 3,400 employees move around in the enormous system.

County officials believe the Sheriff's Office used PHReD and other spreadsheets and databases to monitor employee movements. But as employee assignments changed, the changes did not always get reported to the official payroll system.

The Sheriff's Office employs several systems to track employee movement throughout the county, said Lt. Brian Lee. He said the use of those systems was necessary for the office to function, not a plot to hide information from the county.

In the past two months, county officials have made allegations that later proved incorrect regarding Sheriff's Office spending on trips to Belize, Puerto Rico and Walt Disney World.

"It would seem that recently it has become standard operating procedure for the county to take this sinister approach against us regarding these matters," Lee said. "They've had to back off when we've proven them wrong. We feel they're going to have to back off on these allegations."

Deputy County Manager Sandi Wilson and her staff in the Office of Management and Budget for months have worked to figure out how extensive financial problems are, and she expressed shock at the hidden system.

"They've developed a system that basically tracks where they are working versus where they are being paid, and they did not update the official database, which led to the potential problems," Wilson said. "I think they deliberately hid this info from us."

The employee-tracking database was in a secure criminal-justice computer system accessible only to the Sheriff's Office. Control of access to that system, known as ICJIS, has been the subject of a long-running and expensive legal battle during the past two years.

County administrators say they were puzzled by the sheriff's willingness to sue over what they viewed as minor issues related to control of the ICJIS system. The fight by the sheriff to block county access to the system has cost more than $1.6 million.

County officials believe Sheriff's Chief Deputy David Hendershott sought to limit access to the system to hide the shadow payroll records it contained. Those records showed that potentially hundreds of employees who did no work in the jails were being paid with detention funds.

"That's a reasonable conclusion to draw, but we don't know for sure," Irvine said. "From Maricopa County's perspective, the ICJIS dispute and lawsuit has made no sense."

County officials sent information on the payroll system to the U.S. Attorney's Office for review. That office is conducting a separate abuse-of-power probe of Sheriff Arpaio, his employees and others.

U.S. Attorney Dennis Burke is working with County Attorney Rick Romley to deputize federal prosecutors so they can investigate allegations of crimes committed under state law, including potential legal violations as a result of the hidden payroll system.

Last month, County Manager David Smith, on behalf of the county Board of Supervisors, asked Burke to review financial records for "possible evidence of criminal behavior."

County officials believe sheriff's staff may have violated state statutes that include misappropriation of restricted funds; stealing, destroying, altering or secreting public records; malfeasance in public office; theft; and tampering with computers and public records.

The U.S. Attorney's Office declined to comment.