© DAVID SWANSON/The Philadelphia Inquirer/TNS Harry McKinney, seen here in 2017 with K-9 Unit dog Melody, was paid $67,000 in overtime over the course of three years. County Controller Margaret Reif has said those payments were improper.

A statewide grand jury is seeking records on how former Chester County Sheriff Carolyn “Bunny” Welsh spent her office’s budget, according to documents reviewed by The Inquirer.

A grand jury subpoena, issued Nov. 5 and reviewed by The Inquirer this week, sought payroll records, direct deposit information, routing numbers and other information for bank accounts associated with the sheriff’s office between 2015 and 2019.

It was followed two months later by a second subpoena that asked for hourly wages and/or salaries for all employees of the sheriff’s office between 2016 and 2019, including “deputies, court security and civilian office staff. The subpoenas come at a time when County Controller Margaret Reif is seeking to compel Welsh to reimburse the county $67,000 in overtime she had paid her longtime live-in boyfriend and subordinate, Harry McKinney. In a lawsuit, Reif contends that the overtime payments were “abnormal and inconsistent with county policy.”

© Clem Murray/The Philadelphia Inquirer/TNS Seen here in a 2009 photo, Carolyn "Bunny" Welsh served as Chester County's sheriff for 20 years. Now, a few months after her retirement, a statewide grand jury is seeking financial records from her tenure.

The subpoenas were disclosed last week at a hearing on the suit when Reif’s solicitor, Anthony Verwey, asked a county judge for a six-month delay in the proceedings to allow the grand jury’s work to continue.

The precise focus of the grand jury inquiry was unclear, and a spokesperson for the state Attorney General’s Office said she was unable to comment, citing the rules governing grand jury proceedings.

Welsh, who served as Chester County’s sheriff for 20 years, declined to comment through her attorney, William Gallagher. She has denied any wrongdoing and said McKinney earned all of the overtime he was paid. Welsh, who has appealed Reif’s lawsuit in county court, has called the controller’s inquiry a misrepresentation of financial records and "a negative attempt to smear [her].”

Reif, a Democrat, mounted probes into the office’s K-9 unit and overtime spending during the final two years of Welsh’s tenure.

In June, Reif filed the lawsuit against Welsh, saying the overtime paid to McKinney over three years was "unearned and unmerited overtime that was not based on the result of actual overtime work.”

The controller described the payments, by far the highest within the sheriff’s department, as a way for Welsh to pad her household income and help “spike” McKinney’s retirement benefits — the two have lived together for 15 years.

» READ MORE: Chester County officials spar over dogged audit of sheriff’s K-9 Unit

McKinney was considered an entry-level employee by payroll standards, and was eligible to accrue overtime. Despite this, Reif said, McKinney had been given administrative-level duties, overseeing the sheriff’s K-9 unit and having other members of the department report to him. Such duties should have made him a salaried employee unable to collect overtime, she said.

Welsh, a Republican, declined to seek re-election in November.

Her successor, Democrat Fredda Maddox, did not renew the contracts for McKinney and Dawson R. Muth, the office’s solicitor and an outspoken critic of the controller’s inquiries into the K-9 unit.

Additionally, the questions raised about McKinney’s overtime payments inspired a broadening of the language in the county’s rules on nepotism, according to officials.

Previously, the statute only applied to immediate relatives, connected by either blood or marriage. The new, expanded rules apply to supervisors who live with their subordinates, even if they are not related.

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