Republicans in Harrisburg said improved tax collections could mean more money for education in next year's budget.
The state Senate, using the new numbers, unveiled an alternative Monday to Gov. Tom Corbett's budget plan.
The new plan would give $245 million more to fund higher education and another $73 million for pre-K through 12 education.
It would also include an $84 million boost to county governments for social services.
A spokesman for the governor said the plan isn't sustainable beyond next year because of the growing cost of state pensions, debt service and other mandatory expenses.
Corbett's budget includes education cuts as part of massive funding cuts meant to lower state spending.