AD Quality Auto 360p 720p 1080p Top articles1/5READ MOREGift Box shows no rust in San Antonio Stakes win at Santa Anita “This budget continues California on the path toward fiscal responsibility and economic recovery,” Schwarzenegger said during a midday news conference. Details of the budget plan were emerging, but the big winners appear to be public schools and health and human services agencies. Weeks ago, Schwarzenegger proposed a $4.3 billion boost in funding for kindergarten through 12th grade education and community colleges. Education groups said they will seek even more money once the budget gets submitted to lawmakers, yet the increase has succeeded in partly defusing some of Schwarzenegger’s most vocal critics. Education groups attacked Schwarzenegger last year after he floated proposals about merit pay and teacher tenure, and failed to repay billions of dollars educators said he owed to public schools. Education spending accounts for about half the state’s annual budget. Schwarzenegger also pledged to halt student fee increases in the California State University and University of California systems. Students have faced five fee increases in a row under a deal the universities reached with Schwarzenegger. But Democrats and student groups said the increases amounted to a tax increase on the middle class and lower-income residents. The governor also has tempered fears that he would neglect spending on social services as he sought to placate education groups with a huge spending boost. On Monday, he proposed spending $72 million to enroll more children in the Medi-Cal and Healthy Families programs. The additional money is expected to provide medical services to about 300,000 uninsured children and is part of a $1.2 billion funding increase in health and human services programs. By proposing increases in school and health funding, Schwarzenegger seeks to avoid an extended budget confrontation with the Democrats who control both houses of the state Legislature. Such a skirmish could complicate his re-election campaign and distract him from pushing the $222.6 billion public works spending plan he announced last week. As part of that plan, he wants voters to approve about $25 billion in bonds this year.160Want local news?Sign up for the Localist and stay informed Something went wrong. Please try again.subscribeCongratulations! You’re all set! SACRAMENTO (AP) — California’s tax revenues are surging ahead of expectations, giving an election-year jolt to the state budget and providing more money for public schools, health services and higher education. Gov. Arnold Schwarzenegger on Tuesday proposed a $125.6 billion spending plan that does not raise taxes, a 7 percent boost over last year. It also marks the first time in several years that the state projects enough tax revenue to cover spending without significant borrowing, a reversal from budget deficits that reached into the billions before Schwarzenegger took office. The 2006-2007 budget proposal from the governor includes $97.9 billion in general fund spending and $25 billion in spending from special funds, which is money such as a gas tax that is dedicated to specific programs such as highway repairs. The rest of the spending, $2.7 billion, is to repay bonds.