"The Palestinian Authority has chosen an alliance with violence and extremism over the democratic values that Israel represents," a bipartisan group of US lawmakers said on Thursday after a meeting in Tel Aviv with Prime Minister Binyamin Netanyahu.

The lawmakers were reacting to the new Palestinian unity deal which could imperil hundreds of millions of dollars in US aid if it gives a more prominent role to Hamas.

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Democratic and Republican lawmakers in Washington warned US funding could not flow to a government that includes a group still on the US list of foreign terrorist organizations.

Ileana Ros-Lehtinen, the powerful Republican chairwoman of the House of Representatives Foreign Affairs Committee and a staunch defender of Israel, said US law required a halt to support for the Palestinian Authority.

"US taxpayer funds should not and must not be used to support those who threaten US security, our interests and our vital ally, Israel," Ros-Lehtinen said in a statement.

Nita Lowey, the senior Democrat on the House Appropriations subcommittee that approves foreign assistance, said any Palestinian unity deal with an unreformed Hamas "will be a death blow to the peace process."

The Obama administration reacted coolly to the Hamas-Fatah announcement, saying any future Palestinian government must renounce violence, respect past peace agreements and recognize Israel's right to exist.

The United States has given an average of about $400 million per year to the Palestinian Authority headed by Prime Minister Salam Fayyad, much of it aimed at strengthening governance and security in preparation for eventual statehood.

Total US assistance since 1994 has topped $3.5 billion.

A Congressional Research Service report last year said a potential unity government could drop the development and reform objectives set by the Fayyad administration, which are used as major justifications for current US aid levels.

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