Sources tell NY1 that Gov. Kathy Hochul’s ambitious housing proposal is no longer on the table during state budget talks.

Hochul and legislative leaders have been negotiating a state spending plan, which is now 20 days late.

The governor wanted to include significant policy changes, including tweaks to the bail laws and a bold housing initiative, known as her Housing Compact.

Sources say while the governor appears to have won some of the criminal justice changes she is seeking, her Housing Compact died when legislators refused to support her plan allowing the state to override local zoning on affordable housing developments.

The goal was to force localities to meet affordable housing targets of 3% growth over three years.

Instead the budget will now be stripped of any significant housing plan, according to sources. 

Sources say almost all other housing-related issues have now also been taken off the table in budget talks, including a renewal for the 421-a tax abatement that enables affordable housing to be built in the city, which expired last year, and a controversial proposal known as “Good Cause Eviction,” which would significantly enhance the rights of tenants over property owners, has also fallen out of negotiations.