The Obama administration has sent Congress a report that harshly criticizes the Egyptian government of restricting free speech, arresting political dissidents and undermining democracy, but recommends the U.S. continue sending it $1.3 billion in mostly military aid.

The report, quietly submitted to lawmakers last month, said that while Egypt has implemented some democratic reforms, "the overall trajectory of rights and democracy has been negative."

The six-page report, which the administration is required to send to Congress, said human rights and civil activists have reported a "steadily shrinking space for political dissent" that has prompted them to censor their activities or leave the country. "Except in rare instances, police and security forces have not been held accountable for alleged human rights violations," it said.

An estimated 16,000 people were arrested between July 2013 and March of this year. Some are members of the Muslim Brotherhood and others were arrested for violating a demonstration law that the Obama administration says is not aligned with international standards for protecting freedom of assembly. Former President Mohammed Morsi was a member of the Muslim Brotherhood, but after his ouster, the government of current President Abdel Fattah el-Sissi banned the Brotherhood and staged a massive crackdown on the group, killing hundreds and jailing thousands.

The Obama administration expressed concern for Egypt's decision to expand the jurisdiction of military courts to try civilians. Human rights organizations say up to 3,000 civilians have been tried in military courts since the decree took effect. "An unknown number of individuals accused of various crimes have spent extended periods in pretrial detention without charge," the report said. "Conditions in prisons and detention centers are harsh due to overcrowding, physical abuse, inadequate medical care and poor ventilation."

The report said the Egyptian government has investigated and prosecuted its critics for inciting violence and insulting government institutions or public officials. At the end of last year, at least 12 journalists were behind bars. "The Egyptian government has also closed media outlets, whose coverage of events does not comport with its narrative, and censored stories that present it in an unfavorable light," the report said.

Earlier this year, el-Sissi OK'd a new law that allows the government to designate groups and individuals deemed a "threat to national unity" as terrorists. Critics say the law too broadly defines terrorism to include non-violent acts and could be used to "stifle all forms of opposition."

Moreover, a new law increases the possible criminal penalty to death for those found guilty of receiving foreign money for activities that endangers the state. Many non-governmental organizations and their partners, which receive foreign funds, are worried that their activities could be targeted. In June 2013, an Egyptian court sentenced 43 NGO employees, including 17 Americans, to prison for illegally operating an unlicensed NGO.