The state has approved a major expansion of enterprise zone tax credits for businesses in the San Fernando Valley, Los Angeles Mayor Antonio Villaraigosa announced Wednesday.

The state’s enterprise zone program is an economic development tool that offers tax benefits for businesses in areas that the state deems in need of economic revitalization. Among the benefits: tax credits for hiring, breaks on utility bills, and tax credits for the purchase of machinery.

Enterprise zones are one of the few tools the state can use to lure new business and help existing businesses expand. But the program has been attacked in some quarters as a giveaway of state funds to major corporations.

The first enterprise zone in the northeast San Fernando Valley was established in 1986. It has since been expanded twice to cover about 18,000 acres, encompassing the communities of Pacoima, Lakeview Terrace, Sun Valley, Arleta, Panorama City, Van Nuys and portions of North Hollywood and Studio City.

The expansion announced Wednesday covers 5,444 acres of industrial-zoned land in Chatsworth, Warner Center, Canoga Park, Northridge, the Van Nuys Airport Corridor and portions of the northeast San Fernando Valley not covered in the existing zone.

“Enterprise Zones help businesses lower their operating costs and promote hiring and capital investment through tax credits and deductions,” Mayor Villaraigosa said in the statement announcing the expanded enterprise zones.