NEW YORK — Chinatown’s hard-hit garment makers, along with retailers and other businesses on the Lower East Side and in Little Italy, may get a much-needed break this fall.

Citing the devastating economic slowdown those downtown neighborhoods have faced since the Sept. 11 attacks, the city asked the state to name the area an "Empire Zone," which would entitle new and expanding businesses in the area to significant tax breaks.

Robert Walsh, commissioner for the New York City Department of Business Services, told WWD that if the state designates the area as an Empire Zone, "there would be a whole series of wage incentives and sales-tax incentives that would not cost the city. It would be a big boost for Chinatown.

"Chinatown has lost a lot of jobs, particularly in the garment industry," he continued. "We estimate that 15,000 jobs have been lost, the vacancy rate is in the double digits, and we have to do something."

Mayor Michael Bloomberg on Tuesday signed a bill asking the state to designate the three neighborhoods as an Empire Zone. In June, the state said that it would name six new Empire Zones this fall. Applications are due Aug. 30, and a spokeswoman for the New York State Commissioner of Economic Development said that 25 to 28 municipalities have notified the commission that they intend to file requests.

There are currently 62 Empire Zones, which were formerly called Economic Development Zones, in the state, with 10 of them in city. New businesses in Empire Zones can be exempted from sales taxes and receive reductions in real estate taxes and other taxes based on the number of new jobs they create.

The goal of the program is for new businesses to operate in an almost tax-free environment for their first 10 years of operation.

For the many Chinatown contractors who have laid off workers since Sept. 11, the program could be an incentive to hire people back, Walsh suggested.

Since Sept. 11, the number of garment contractors in Chinatown has dropped to 137 from 246, said Teddy Lai, executive director of the Greater Blouse, Skirt and Undergarment Association, a contractors group.Lai said designating the area an Empire Zone "will encourage more factories to come back to business."

Lai also praised the efforts of Walsh’s department in quickly preparing the application for the program: "It usually takes about eight months, nine months to file an application, but with DBS, we had it done in a month-and-a-half."

The program would also be a boost to retailers on the Lower East Side, which rose in importance as a hip shopping area over the past few years, but has seen a falloff in pedestrian traffic since the attacks.

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