Jerry Kremer has a proposal before the New York City Council that he said could restore lost tourist money.

Kremer, the founder of Uniondale, N.Y., lobbying group Empire Government Strategies and a former New York State assemblyman, wants the city to permit European-style youth hostels and encourage their growth.

The City Council has a bill before its housing committee that would correct legislation passed in 2010 that clamped down in single-room occupancy units and other illegal hotels. An unintended consequence was the demise of the spattering of hostels, which Kremer said has cost the city about $150 million over two years.

"The net result is that hostel operators have gone to Miami, Washington, San Francisco and Chicago," Kremer said in an interview. "You've got old manufacturing buildings in Long Island City and Williamsburg ideal for this use. This could stir a new type of economic development."

NYC & Co., the city's tourism and marketing wing, is sponsoring the bill, which has the support of Mayor Michael Bloomberg and City Council Speaker Christine Quinn.

Bloomberg touted the measure in his state of the city address in February. The city's goal, he said, is to attract 175,000 more young tourists, which he said would create more than 1,000 new jobs.

"Right now, we're missing out on an important piece of the market: the young people who have an itch to get out and see the world on modest budgets. Hotels in our city can be out of their price range," Bloomberg said.

"This could add another leg to the chair," Kremer said. "The focus has been just to get tourists into the hotels, and to the Broadway shows and museums, with no focus on the age of the tourist. But today's hostel visitor could be tomorrow's hotel visitor."

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