The rumor mill in New York continues to float stories about the bargaining away of gay marriage in the upcoming state Legislature.

It was just last week that a New York Times story implied that a promised gay marriage bill had created a leadership log jam in the state Senate. The report cited three Senate Democrats who were holding out for greater power on this issue and others.

Senator-elect Pedro Espada Jr, Senator Ruben Diaz Sr. of the Bronx, and Senator Carl Krugen of Brooklyn each were threatening to leave the Democratic party if Senator Malcolm A. Smith would be made leader of the chamber.

After a three-hour meeting, New York Governor David A. Paterson brokered a power-sharing deal between the four men.

According to the Times, the deal calls for Smith to become the first Democratic leader in the Senate in more than 40 years, but at the expense of sharing the responsibility with Espada.

Gay activists poured considerable efforts and money into New York Democratic races in hopes that a democratically led Legislature and Governor would respond in kind with a gay marriage bill.

Early on, however, Senator Ruben Diaz Sr. said he could not vote for a pro-gay marriage leader and demanded that a gay marriage bill not be brought to the floor.

Paterson has a long record of supporting gay marriage. During the summer, he directed all agencies to recognize gay marriages performed outside of the state, Massachusetts and California at the time.

And at this year's National Gay and Lesbian Task Force dinner, Paterson said: “We will push on and bring full marriage equality in New York State. And when we have done that, we're going to do more. We're going to protect young people from bullies. We're going to protect against the discrimination of people in the transgender community, and we're going to fight for decent and affordable healthcare for all citizens in this state. If you will join me, and if we work hard enough, we can change the face of New York, which will be the catalyst for changing national policy.”

But the deal Paterson brokered with the so called Gang of Three may well have dealt that hand away.

The New York Daily News is reporting that the new plan is “to have the same-sex marriage bill introduced, determined to have fiscal implications and referred to the Finance Committee, which, assuming the agreement between the gang and Smith sticks, will be headed by Senator Carl Kruger, who could stop the measure in its tracks.”

Empire State Pride Agenda Executive Director Alan Van Capelle quickly responded to the news. In a statement he said: “We are still awaiting the final details of the announced State Senate leadership deal. We would expect that any rumors that marriage equality was somehow a part of this deal are just that – rumors. Civil rights should never be a bargaining chip in any political leadership battle, and we would be outraged if the issue of marriage equality was even part of the discussions.”