New York state said its fund to pay unemployment insurance benefits will run out next month due mainly to Sept. 11-related claims, and it asked the federal government Friday for up to $740 million in stopgap loans.

The state Labor Department also said the assessments it makes on employers in the state will go up for 2002 by $35 to $42 per employee so the state can replenish the fund.

As of mid-January, there was about $200 million in the unemployment insurance fund. At the same time in 2001, before the worst of the national recession and the destruction of the World Trade Center towers by terrorists, the fund totaled about $1 billion, according to Labor Department spokesman Betsy McCormack.

In a letter to federal Labor Secretary Elaine Chao, state Labor Commissioner Linda Angello said the state believes 103,000 filings for unemployment insurance since Sept. 11 were directly related to the economic disruption caused by the terrorist attack. The state estimates that through March, it will pay $266 million from the fund to those workers.

Angello asked the federal government for a $90 million loan in February, $350 million in March and $300 million in April to meet the cost of the surge in benefit payments.

The money will be repaid when the fund is replenished through the higher assessments on employers in the state, McCormack said.

In the meantime, she said, efforts by the Pataki administration and the state's congressional delegation will continue to get the state's higher unemployment insurance costs covered through post-Sept. 11 federal relief payments to New York.

Chao's office did not return a telephone call seeking comment on New York's request. McCormack said the letter from Angello to Chao was sent by a courier Friday and that it would not be received on the same day in Washington.

The percentage increase for unemployment benefits will vary widely for employers depending on their employment histories and how frequently their workers have filed unemployment claims. Employers with the worst histories can pay nearly $800 a year per worker into the fund.

For average employers, the increase will be between 12 percent and 16 percent per employee, McCormack said.

In the 18 weeks since Sept. 11, the state's average initial jobless claims have been averaging between 25,000-30,000 a week, or about 8,000 a week more than before the terrorists' attack, McCormack said.

The state's largest corporate lobbying group, the Business Council, has been warning its members for months that the assessments by the fund will be going up.

"Our members have known for a long time that the system is volatile," said the Business Council's Elliott Shaw. "It can run up huge surpluses in good times and it can drain itself very quickly in bad times."

Workers qualifying for unemployment benefits in New York get maximum payments of $405 a week for up to 26 weeks. The average payment is $280 a week, McCormack said.

The state Labor Department attributes unemployment claims filed by workers at about 5,800 companies to the Sept. 11 terrorist attack. The vast majority are in New York City and its surrounding counties, according to McCormack.