As expected, the State Department on Thursday released a report that keeps Cuba on the list of state sponsors of terrorism, even as it acknowledged that some conditions on the island were improving.

State’s Country Reports on Terrorism for 2012 was widely expected to keep Cuba, Iran, Sudan and Syria on the list of countries that sponsor terrorism, despite some reports that incorrectly suggested that it might be used by Secretary of State John Kerry to shift policy on Cuba.

{mosads}In the case of Cuba, State listed three primary reasons for keeping the island nation on the list. First, it noted that Cuba continued to provide a safe haven for about two dozens members of Basque Fatherland and Liberty (ETA), a group charged with terrorism in Spain.

State’s report, though, seemed to give Cuba some credit for hosting peace talks between the government of Colombia and members of the Revolutionary Armed Forces of Colombia (FARC). The report notes that Cuba offered aid to FARC members “in past years,” and indicates that Havana is no longer supporting the rebel group.

A second major reason for listing Cuba was that the government “continued to harbor fugitives wanted in the United States.” That language is unchanged from last year’s report.

And thirdly, State said Cuba has deficiencies in the area of anti-money laundering and combating the financing of terrorism, just as it did in last year’s report. This year, however, State also noted that Cuba has become a member of the Financial Action Task Force of South America, which requires Havana to adopt anti-money laundering recommendations.

But still, this improvement and the hosting of peace talks between FARC and Colombia were not enough to remove Cuba from the list.

Critics of the designation of Cuba as a state sponsor of terrorism have long argued that the State Department has always had a thin case for listing Cuba at all.

A Washington lawyer with expertise in Cuba and international law, Robert Muse, told The Hill that none of the three reasons listed by State are enough to satisfy the legal requirements that must be met to list a country as a state sponsor of terrorism.

Muse said arguments about harboring U.S. fugitives are especially weak, since U.S. law says designations must be made against countries that “repeatedly provided support for international terrorism.” As such, Muse said the fact that fugitives from U.S. justice are living in Cuba is not enough to trigger a mention in the report unless those fugitives have committed international terrorist acts.

Muse also said the other two reasons have been so diluted that the Obama administration could be setting the stage for removing Cuba from the list.

“The Obama administration has left the door open to taking Cuba off the list at some point in the future,” Muse said.

One fugitive from U.S. justice now living in Cuba is Joanne Chesimard, who killed a New Jersey state trooper in 1973 and fled to Cuba. Earlier this month, the FBI put Chesimard on its “most wanted” list of terrorists, although State’s report does not name her specifically.

Rep. Ileana Ros-Lehtinen (R-Fla.) said in reaction to the report that it rightfully keeps Cuba on the list, and noted Chesimard.

“The report reaffirms that the Cuban dictatorship provides safe haven to foreign terrorist organizations such as the FARC and ETA and harbors fugitives wanted in the United States, one of them being Joanne Chesimard who is wanted for the murder of a New Jersey State Trooper,” she said.

Decisions by the government to remove countries from the list of state sponsors of terrorism can be made at any time by the president. These decisions are independent of the Country Reports on Terrorism, which always review actions from the prior year.

To remove a country from the list, the president must give notice to Congress by submitting a report outlining why this change is being made.

Cuban-American lawmakers last month had pressed the White House to ensure that Cuba had remained on the terror-sponsor list.

The decision also comes as Cuba continues to hold an American citizen Alan Gross in prison, the latest hurdle to efforts to improve relations between the two countries.

Gross is serving a 15-year sentence after being convicted on charges of trying to subvert the government.  The White House and lawmakers have called on Cuba to release the 63-year old Maryland man, who is said to be suffering health problems.

Ros-Lehtinen said she is “disappointed” that the report does not mention Cuba’s imprisonment of Gross, Cuba’s cooperation with Iran and Syria, or Cuba’s spy network in the United States. She said these omissions amount to concessions.

“The administration should immediately stop giving concessions to the regime and deny U.S. visas to their operatives who will never respond to diplomatic niceties,” she said. “The Castro brothers will always take any step to undermine U.S. interests, harm U.S. citizens, and support our enemies.”

— This story was updated at 8:11 p.m.