The House Ethics Committee on Wednesday indicated that it may need to extend the contract of the independent counsel it hired to examine the botched investigation of Rep. Maxine Waters (D-Calif.), carrying the investigation into next year.

It was unclear whether the extension was an indication that the outside lawyer, Billy Martin, found wrongdoing within the committee or whether he simply has yet to complete the initial stage of investigating the Waters matter.

Ethics Chairman Jo Bonner (R-Ala.) told the House Administration Committee during a hearing Wednesday that “our hopes and estimates for a quick resolution to Mr. Martin’s work may not be realized. While no final conclusions have been reached about whatever the ‘next steps’ in this process might encompass, it is highly possible that the contract with Mr. Martin will need to be extended into next year.”

Martin — a partner at the law firm Dorsey & Whitney, whose past clients have included former Sen. Larry Craig (R-Idaho) and other high-profile lawmakers — was hired by the Ethics Committee in July to investigate the actions of committee staffers during the Waters probe and determine how and if it should continue.

The committee had been investigating whether Waters and her staff intervened with federal regulators on behalf of a community bank in which her husband was heavily invested.

Last November, just days before a public ethics hearing was slated to begin, the committee announced that new information had arisen and the Waters trial would be postponed. Internal committee email surfaced in July suggesting that the delay was caused by concerns on behalf of the panel’s former staff director that political infighting within the committee had compromised the integrity of its investigation. The committee at that point announced the hiring of Martin to investigate the matter, giving him until Jan. 2, 2012, to file his report.

At the time, Waters claimed vindication.

“For the first time in the history of the ethics committee, it has initiated an inquiry into its own misconduct … I am confident that the outside council’s review of the committee’s misconduct will conclude that my rights were violated and further investigation of me is not warranted,” she said in a statement at the time.

When the committee hired Martin, it explained that the independent investigator would first look into any possible wrongdoing by committee members and staffers and then determine whether the Waters case could proceed.

“Serious allegations have been made about the Committee’s own conduct in this matter by Representative Waters and others. The Committee has not taken these allegations lightly … the entire Committee has therefore directed that a thorough review of all of these serious allegations will be the very first task of the outside counsel’s engagement, including providing an additional opportunity for Representative Waters to clarify her concerns to the Committee and outside counsel. Outside counsel will then report his findings and conclusions to the full Committee, which will then determine whether the matter should proceed. Should the matter proceed, outside counsel will continue to make appropriate recommendations and provide appropriate assistance to the Committee to complete the matter as quickly as possible,” Bonner and ranking member Linda Sánchez (D-Calif.) said in a July joint statement.

According to Martin’s contract with the House, he was authorized to bill the committee up to $500,000 for his legal assistance. Bonner told the House Administration Committee on Wednesday that he anticipates another $350,000 will be needed for Martin to complete his investigation.

Though ongoing ethics investigations are confidential and Bonner did not discuss the Waters probe by name, he testified that Martin’s contract would likely need to be extended and that “at least one of our major investigative matters may require a contract, or other significant expenses for hearings and travel.”

Sánchez told House Administration Chairman Dan Lungren (R-Calif.) that “we await the outside counsel’s recommendations for our consideration so the Committee can complete the matter as quickly as possible and ensure the Committee’s work comports with the highest standards of integrity.”

Bonner proposed that the 2012 Ethics Committee budget should be roughly
$3.4 million, which includes the $350,000 it would need to reauthorize Martin’s contract. It currently has 24 of 29 staff positions filled and about 95 percent of its budget goes toward its personnel, Bonner said.

Lungren indicated that although all committees are facing a 6.4 percent budget cut, he is sympathetic to the fact that reduced ethics funding could force the committee to leave positions open, which could compromise its ability to provide Members and staffers with ethics advice and conduct reliable investigations.

“I don’t think we can defer maintenance on the ethics of this House,” Lungren said.

With the announcement Monday by Rep. Barney Frank (D-Mass.) that he will not seek re-election, Waters is next in line in seniority and is in position to vie for his spot as ranking member on the House Financial Services Committee.