A liberal advocacy group that has received more than $16 million in federal grants from the Department of Housing and Urban Development is now suing the agency after HUD Secretary Ben Carson last month scaled back a regulation it supports.

HUD has given the liberal National Fair Housing Alliance $16.1 million in grants since 2009, according to USAspending.gov, which tracks federal grants and contracts. Under the Trump administration, the organization has received just one grant—$300,000 in March.

“NFHA was awarded roughly $16 million in grants from [fiscal 2009 to fiscal 2016],” Jessica Aiwuyor, associate director of communications for the organization, told The Daily Signal in an emailed statement, insisting that none of it is being used to file its legal action. “NFHA has used zero HUD funds to bring this lawsuit. NFHA uses zero federal dollars to conduct lobbying. We do not have a separate arm for advocacy or lobbying.”

She said that 55 percent of Fair Housing Initiatives Program dollars that HUD has given the group “were passed through to other organizations to fight illegal housing discrimination and educate the public about fair housing laws.”

Federal law prohibits using grants from the Fair Housing Initiatives Program for funding lawsuits against the federal government. The program provides federal funding to fair housing groups and other nonprofits that assist people who claim to be victims of housing discrimination.

A senior HUD official said agency grants are awarded on a competitive basis, and political or litigious activities of a group cannot be considered for grants.

The legal clash stems from a HUD announcement in May that it would be doing away with a computer tool that was key to an Obama administration regulation known as Affirmatively Furthering Fair Housing.

The Obama-era rule was finalized in July 2015. The centerpiece of the rule was a computerized assessment tool that was touted as making it easier to identify housing discrimination.

The rule would have required local governments to use the tool to determine exactly what type of housing disparities residents face, and report that back to HUD. If the local community didn’t provide a plan to fix the problem with new zoning rules, it stood to lose out on HUD funding.

According to HUD, the Local Government Assessment Tool was “confusing, difficult to use, and frequently produced unacceptable assessments.”

“We believe in furthering fair housing choice in our neighborhoods, but we have to help, not hinder, those who have to put our rules into practice,” Anna Maria Farias, HUD assistant secretary for fair housing and equal opportunity, said in a statement after the announcement. “We must make certain that our tools can facilitate the goals we all share—to build inclusive and sustainable communities free from discrimination.”

Any local government that hasn’t yet submitted an assessment of fair housing is still legally obligated to present a plan to HUD, and the department will be offering technical assistance to local jurisdictions.

In the Federal Register, HUD stated it spent more than $3.5 million assisting local governments in working with the tool.

“HUD is withdrawing the Tool to produce a more effective and less burdensome Assessment Tool,” the notice reads. “These improvements to the Tool will make it more effective in assisting program participants with the creation of meaningful assessments with impactful fair-housing goals to help them plan to fulfill their legal obligation to affirmatively further fair housing.”

The HUD rollback of the rule has been in the works since January.

The National Fair Housing Alliance announced the lawsuit, filed in U.S. District Court in Washington, D.C., days before the formal HUD announcement. Two other nonprofit advocacy groups, Texas Appleseed and the Texas Low Income Housing Information Service, are also plaintiffs in the litigation. They are asking the court to require HUD to enforce the entire rule.

The complaint claims HUD unlawfully suspended the requirement, effectively removing civil rights oversight of as much as $5.5 billion per year through 2024 or later for almost 1,000 local jurisdictions.

“For [30] years, NFHA has promoted the Affirmatively Furthering Fair Housing requirement of the Fair Housing Act. We have advocated to HUD to release an effective AFFH Rule; educated jurisdictions, fair housing groups, and community-based organizations about the AFFH requirements; and implemented programs designed to further fair housing,” said Lisa Rice, of the National Fair Housing Alliance, in a public statement.

“Each day HUD holds up requiring jurisdictions to fully comply with the law is another day that millions of people are being denied fair housing opportunities. HUD’s action is a clear example of ‘justice delayed, justice denied,’” Rice said.

Judicial Watch, a conservative government-watchdog group, in a post called it “an amusing—and unbelievable—story” that HUD is bankrolling an organization that is suing it. Judicial Watch criticized the Obama-era program.

“[Affirmatively Furthering Fair Housing] also requires federal and local governments to spend tens of millions of dollars annually gathering statistics on racial and ethnic concentrations in America’s neighborhoods,” the Judicial Watch post says.

The group said the lawsuit was brought by “a group of leftist organizations.”

The National Fair Housing Alliance is engaged in significant public policy advocacy. It tracks the federal budget advocating increased investigations of housing discrimination complaints, and advocates expanding the Fair Housing Act to protect gay, lesbian, and transgender people.

Currently, the 1968 law outlaws discrimination on the basis of race, color, national origin, sex, religion, familial status, and disability. It does not address sexual orientation and gender identity.

Judicial Watch also noted that liberal billionaire George Soros’ Open Society Foundations gave the organization $475,000 in 2016.

Deidre Swesnik, a program officer with the Equality Fund of the Open Society Foundations’ U.S. programs, confirmed the $475,000 donation.

“There is ample research showing racial discrimination by ZIP code in this country,” Swesnik told The Daily Signal. “Like the majority of Americans, the Open Society Foundations believe people should be able to live where they want without being barred because of their race.

“HUD has important responsibilities under the Fair Housing Act to make sure that its program and those of the cities, counties, and states that it funds advance fair housing. We support the National Fair Housing Alliance work and the work of other organizations to combat housing discrimination wherever it occurs,” she said.