Houston remains so far apart with the Chiefs that the source said there was no chance of a long-term deal getting done.
The Chiefs could apply the franchise tag after this season as they are also trying to extend quarterback Alex Smith. But the team might end up having a decision to make about which player to tag.
The market for pass rushers is always intense and with players like Robert Quinn also possibly getting new deals this year, the price only stands to go up if the production is there. Young pass rushers Aldon Smith and Von Miller are also eligible for extensions, but have off-field concerns that could mitigate receiving a new deal in the short term.
Houston is a priority for Kansas City, especially with Tamba Hali turning 31 during the season.