Schwarzenegger pleased members of the League of California cities when he made his announcement concerning the so-called May Revise.
"We will fully restore Proposition 42 and put more than 1.3 billion dollars back to transportation."
Proposition 42 was passed by state voters three years ago. Its intent was to require that the sales tax on gasoline be used only for transportation purposes, including road maintenance. But the revenues have been diverted each year to shore up the state's deficit-plagued general fund.
League of Cities spokeswoman Megan Taylor said local governments would get over a quarter of a billion dollars next year for road maintenance.
"The governor's announcement means that for the first time since the initiative was passed, the voters' will is going to be implemented."
With state revenues growing, Governor Schwarzenegger is expected to announce other spending increases when he releases his new budget on Friday.