Incentives to significantly expand available housing in New York and make it more affordable will not be enough, Gov. Kathy Hochul said Tuesday in a statement as her proposals face headwinds in the ongoing budget negotiations. 

Sources on Tuesday said lawmakers were jettisoning key provisions in Hochul's initial statewide housing proposal this year, including fast-tracking qualified housing projects over local objections. 

Instead, lawmakers and Hochul are considering a plan for a housing access voucher program, similar to what the state Senate and Assembly proposed in March, sources familiar with the talks said. 

Hochul, in a statement, said that won't nearly be enough to address the problem. 

"After weeks of negotiations, the Legislature continues to oppose core elements of the Housing Compact, including the requirement that communities across the state meet growth targets," Hochul said. "We have not yet come to a final agreement, but it remains clear that merely providing incentives will not make the meaningful change that New Yorkers deserve. I will continue to discuss other elements of the plan and policy changes that will increase supply and make housing more affordable.”

The plan was met with fierce opposition from suburban lawmakers who insist on maintaining local control. 

“That has been one of the major planks in the governor’s program,” said Democrat Linda Rosenthal of Manhattan, the Chair of the Assembly’s Housing Committee. “She may be backing away from mandates and overrides despite the need for more housing in the suburbs and elsewhere.”

Supporters of Hochul's housing compact were also upset with the ongoing opposition as a final agreement remains unresolved. 

"We are extremely disappointed that the Legislature failed to address segregation and the housing shortage by rejecting the visionary Housing Compact. It is especially shocking that the Legislature, made up of members who run for office on solving the housing crisis, rejected such a comprehensive, data-driven policy plan and instead capitulated to powerful NIMBYs who prefer the status quo," said New York Housing Conference Executive Director Rachel Fee. "By doing so, New York’s elected officials have once again let their constituents down and signaled that the ongoing housing emergency is acceptable."

Housing policy, along with bail law changes, have been the main issues under discussion as a broader agreement over an estimated $227 billion spending plan for New York remains unresolved nearly three weeks past the April 1 due date. 

Hochul has made a push for housing with a goal of 800,000 new units within the next 10 years. She has called for measures meant to spur development, including local-level targets for growth in municipalities as well as money for expanding water and sewer projects. 

But Democratic lawmakers have not embraced all of the proposals. Senate Majority Leader Andrea Stewart-Cousins has said she prefers a more incentive-based approach to coax development along. 

At the same time, lawmakers have also called for money meant to aid low-income renters as eviction protections during the pandemic have been lifted. 

A temporary spending measure was approved Monday and expires on Thursday.