New York lawmakers on Wednesday return to Albany, where they’re expected to renew their push for major action on housing amid a $4.3 billion budget gap – once again pitting an ambitious legislature against Gov. Kathy Hochul.

Tensions between the governor and state legislators that had flared last year were freshly stoked at the end of 2023 after Hochul vetoed several bills with strong support, including ones to ban non-compete clauses and require the posting of emergency contracts.

The governor also shot down legislation requiring LLCs to publicly list their owners — and on Friday Hochul killed a bill for a second year in a row that would award victims’ families compensation in wrongful death lawsuits.

Asked about the veto-streak Tuesday, Hochul blamed the legislature for not interfacing with her office more.

“We can get to fewer vetoes, but let’s have more common sense involved in the process of developing the legislation and make sure it’s practicable,” Hochul said. “‘Is the timing right? Does it have an impact that you did not perhaps see that we now see?’”

The defiant tone from Hochul sets up what could be another combative year for a governor who’s tried to image herself as a dealmaker, in contrast to her strong-arming predecessors.

Last year, Hochul was publicly humiliated by the legislature after liberal state senators refused to confirm Judge Hector LaSalle as her pick to lead the Court of Appeals, New York’s highest court.

The governor is now yet again on a collision course with lawmakers on housing, a policy area that was scrapped in last year’s state budget after she couldn’t strike a deal with legislators.

“We’re talking about housing, it’s going to be an important part of it,” Hochul acknowledged, while declining to go into details.

Last year, Hochul had pushed to address skyrocketing rents by renewing the now-expired 421-a incentive which would provide developers with tax breaks for building affordable housing. The governor had also pledged to build 800,000 new homes over the span of 10 years.

Liberal progressive groups simultaneously pushed for Good Cause Eviction, a proposal that included protections for tenants as well as capping rent increases for market rate housing at 3%.

Attempts to package the two proposals trudged on weeks after the state budget was due and ultimately led to a stalemate.

It remains unclear how the two sides might be able to reconcile on a substantial deal this time around.

The state must also plug the $4.3 billion state budget gap. Hochul has promised not to raise income taxes to address the shortfall, but progressive activist groups are already rallying to hike taxes on wealthy New Yorkers.

At the same time, activist groups and various state agencies are pressing for more funding.

According to reporting from the Albany Times Union, the SUNY system is warning it either needs tuition raises or an infusion of cash from the state to close a $244 million budget shortfall this year — a gap that would increase to almost $1.1 billion in 10 years without action. Additionally, advocacy groups are calling for more funding to be shelled out on healthcare, education, and climate priorities.