Updated 5:47 p.m.

After three years, two Congresses and perhaps close to $1 million in outside legal fees, the House Ethics Committee has finally concluded its probe into alleged misconduct by Rep. Maxine Waters.

Though the committee cleared the 11-term California Democrat of misconduct, the panel convened a rare public hearing today to settle the question of whether to formally admonish Waters’ chief of staff and grandson, Mikael Moore.

As of late afternoon, a source close to the committee proceedings told Roll Call that a decision would not be made before the end of the day.

It appeared that the committee was poised to issue a letter of reproval to Moore for knowingly ignoring Waters, who the committee believes explicitly instructed him not to intervene on behalf of a bank in which her husband was a stakeholder. The committee also indicated it was ready to release a report that would essentially clear Waters while finding Moore at fault.

But today’s hearing was an opportunity for Moore to make his case, defend his actions and maintain his innocence against charges he knowingly exercised a conflict of interest. The delay in transmitting the reproval letter and the report, based on findings by outside counsel Billy Martin, could indicate that the committee is considering taking a different route.

“No final vote or conclusion has been made in this matter,” said acting chairman Rep. Bob Goodlatte (R-Va.) at the opening of the hearing. “The committee takes this hearing very seriously, and is open to having Mr. Moore persuade us that the [draft report] and potential conclusions we are considering are wrong.”

Waters had been facing charges for using her influence as a senior member of the House Ethics Committee to curry favor for OneUnited Bank with Treasury Department officials. The committee ultimately determined that she took all appropriate actions to avoid a conflict and exonerated her of the allegations.

Moore is facing two formal changes of House ethics rules violations, according to his attorney, Andrew Herman: bringing discredit to the House and using a Congressional office to accrue a personal gain. He is also facing allegations of violating a section of the Code of Ethics for Government Service, which prohibits government employees from”accept[ing] for himself or his family, favors or benefits under circumstances which might be construed by reasonable persons as influencing the performance of his governmental duties.”

At the hearing, which was requested by Moore, Waters and her husband, Sidney Williams, sat in the front row behind the witness table where Moore and Herman were seated. Moore argued that the committee, in its own findings, determined that the chronology of events was unknown and because of that, it was not possible to say for certain whether Moore knowingly disregarded Waters’ instructions.

However, former testimony and correspondence suggests that Moore did, or at least should have, known it was against House rules to pursue legislation on behalf of an organization in which the Member he was working for had a stake.

“We are troubled by the fact that Mr. Moore’s testimony raises substantial issues of credibility,” Martin said.

A letter of reproval from the committee would not be the harshest form of punishment the Ethics panel could hand down. It would, however, be a blemish on Moore’s reputation.

For that reason, Rep. Steven LaTourette (R-Ohio), a member of the panel handling the Waters investigation, asked Moore if he would prefer the Ethics Committee take more time to form an investigative subcommittee that could more fully explore the charges and perhaps clear his name.

Moore, after a prolonged silence and brief consultation with his lawyer, said he would prefer not to draw out the process any longer.

“Whether it’s a letter of reproval or saying the idea that I knowingly and intentionally used the Congresswoman’s office for personal gain, that I disrespected the House, is a very difficult pill to swallow,” Moore said. “The way I’ve been trained [is] to fight … but in this circumstance, I would say no [to an investigative subcommittee].”

With Waters cleared of wrongdoing, she will now be free to fully pursue the top Democratic slot on the Financial Services Committee as current ranking member Barney Frank (D-Mass.) prepares to retire at the end of this Congress.

He issued a statement this afternoon expressing enthusiasm for the Ethics Committee’s decision.

“I was pleased but not surprised that the House Ethics Committee found no reason to bring any charges against my colleague Maxine Waters,” Frank said.

Almost Over

The Waters probe began in 2009 at the independent Office of Congressional Ethics, which then referred the case to the ethics panel.

Just days before a rare public ethics trial conducted by the House committee was slated to begin in November 2010, the committee announced it would be sending the case back to the investigative subcommittee “due to materials discovered that may have had an effect on the investigative subcommittee’s transmittal.”

Shortly thereafter, it was revealed that two staffers were placed on administrative leave and that the former staff director had resigned. Later, internal committee documents published by Politico showed the committee’s former staff director thought the staffers’ improper behavior had likely compromised the investigation.

The leaked communications raised questions about whether then-Ethics Chairwoman Zoe Lofgren (D-Calif.) and ranking member Jo Bonner (R-Ala.), who now chairs the committee, had allowed partisanship to affect the committee’s investigation.

Waters argued that her due process rights had been violated and that the committee should abandon the charges. In July 2011, the committee hired Martin to determine whether committee members and staffers had acted in a way that improperly impacted Waters’ case. Martin was asked to determine whether the case should be dropped, restarted or proceed.

Martin found no indication that Waters had been deprived due process in the handling of her case, clearing the way for today’s hearing.

Martin has racked up significant legal fees. The first contract awarded by the House to oversee the Waters investigation authorized Martin to bill up to $500,000. When that contract was poised to expire, the Ethics Committee requested and received an extension from the House Administration Committee, which greenlights contracts between Members and outside groups. This time, the contract authorized an additional $500,000. The final contract extended an additional authorization of funds, not to exceed $500,000, through December 2012.

Though it would first appear that Martin might have earned as much as $1.5 million, an aide with the House Administration Committee explained that each time a new contract was awarded, all the funds that were not used under the previous contract were essentially forfeited.

According to a source familiar with the process, Martin did not spend all the funds authorized in the first two contracts, and it was not immediately known how much of the final $500,000 authorization Martin had used.

The source said that House Administration Committee Democrats had significant reservations about approving a third funding authorization to Martin, given how much time and money it was taking to reach a conclusion. The source described “reluctance” on the part of committee Democrats to defer to the Ethics Committee’s request.