It proposed a "state within a state" for the Serb-majority areas (specifically the districts of Glina and Knin), allowing for a local president, parliament, flag, and even its own currency and police force.
The phrase in this context most likely refers to the Z-4 Plan (officially titled "Draft Agreement on the Krajina, Slavonia, Southern Baranja and Western Sirmium"). The Z-4 Plan (Draft Agreement) Krajina
Proposed in early 1995 by the "Zagreb 4" (ambassadors from the US, Russia, EU, and UN), this draft aimed to prevent further conflict by offering the Krajina Serbs significant autonomy within Croatia. It proposed a "state within a state" for
Despite the autonomy, the territory would remain under the internationally recognized sovereignty of the Republic of Croatia. allowing for a local president