The U.S. Agency for International Development is strongly rejecting complaints of political favoritism in its grant of $3.4 million to a human rights group closely linked to the Cuban American National Foundation.

USAID this summer approved the three-year grant to the Foundation for Human Rights in Cuba (FHRC), a Miami nonprofit created by CANF members, to help support civil society and democracy on the communist-ruled island.

News of the grant drew complaints from critics who allege that FHRC has little experience with such grants and point to the warm relations between CANF, the premier exile organization, and the Obama administration.

South Florida Republican Rep. Mario Diaz-Balart complained last week that U.S. funds for democracy programs in Cuba “should be provided only to organizations with strong experience and proven track records” on the island.

“It would be a disgrace if the Obama administration broke with tradition and used a penny of that critical funding to reward political cronies,” Diaz Balart added in a statement emailed.

Mark Lopes, USAID Deputy Assistant Administrator for Latin America and the Caribbean and a former aide to Sen. Bob Menendez, D-N.J., said a “technical evaluation committee” made up of officials from government agencies is in charge of reviewing grant applications and selecting winners.

“The criteria for competing for USAID funds is included in the grant application … This is a technical process based on the merits of the proposals submitted,” Lopes added. “No political appointee had any role in the selection process.”

Washington’s Cuba democracy programs have been criticized as inefficient and that they only provoke Havana authorities, who outlawed any cooperation and view the programs as “subversive” attempts for “regime change.”

USAID subcontractor Alan Gross is serving a 15-year prison sentence in Havana on charges of undermining the island’s national security by providing a satellite telephone to Cuban Jews so they could connect to the Internet more easily.

CANF members established the FHRC in 1992 to receive tax-deductible donations for its work with dissidents and human rights activists. It shares CANF’s street address and phone number, and its president, Tony Costa, sits on CANF’s board of directors.

Several hard-line members split from CANF after founder Jorge Mas Canosa died in 1997. They founded the Cuban Liberty Council. The council backed Sen. John McCain in the 2008 elections, and CANF leaders now have the ear of the Obama administration.

The FHRC grant appeared to be particularly annoying to critics because a CANF report in 2008 criticized the Cuba democracy programs, and because it came at a time when the U.S. government was cutting funding to other exile groups in Miami.

The CANF report alleged that less than 17 percent of the $65 million that Washington spent on Cuba programs between 1998 and 2008 went to “direct, on-island assistance.” The rest, it claimed, was spent in the United States on salaries, other expenses and academic studies.

FHRC executive director Jorge Alvarez said USAID “has emphasized to all partners that most of the funds should be spent on the island, and we will follow that guidance.” He declined any other comment, citing FHRC policy on U.S. grants.