A group of Alexandria blacks has challenged the results of a U.S. Department of Housing and Urban Development investigation into city housing policies, saying that HUD ignored their charges of discrimination.

"HUD did not handle this investigation properly," said Inga A. Watkins, an attorney for the 16th Census Tract Crisis Committee, which charged in July that several of the city's urban development decisions had the effect of violating blacks' constitutional rights to fair housing opportunities.

Last week, HUD concluded that Alexandria officials did not purposely reduce housing opportunities for blacks.

The complaint alleged that the city's development policies, such as relocating U.S. Rte. 1 through a black neighborhood and declaring the predominantly black Parker-Gray neighborhood a special preservation district amounted to housing discrimination against blacks.

The Alexandria group asked HUD to review its decision, and at a news conference Friday it said that it may sue the city over the issue in federal court.

Officials of HUD said that they will meet with representatives of the group and the city this week.

"We always give parties a chance to respond back to the department within a week of making a decision," said Darry Carmine, a HUD spokesman. "And in this case, both parties have indicated that they want to talk to us."

In making its finding that Alexandria did not discriminate against black residents with its housing and development policies, HUD indicated that the city nevertheless failed to keep racial data required for federal community development block grants.

City officials countered that those charges were inaccurate and inexplicable.

"If you receive block grants you must keep racial data on hand, and we always have," said Beverly Steele, the city's acting assistant city manager for housing. "We have no idea why the report implied it has not been available."

She added that she thought the report indicated that HUD had decided to conclude its investigation.

"As far as we were concerned the letter from HUD was the final word on the whole thing," she said.

The 16th census tract group said, however, that HUD stood on narrow ground when it made its decision to terminate the investigation without finding that the city had been guilty of discrimination.

It said that their allegations went far beyond the scope of the investigation that HUD carried out. "They just looked at the use of federal funds," said Watkins. "They did not address issues involving state, local or city funds or the practices the city used with those funds. They ignored the basis of our complaint."