Successful tenders would help cover the loss of work in the sector since Caterpillar ceased heavy equipment manufacturing in Burnie, and potentially lead to new markets on the mainland or overseas.

Meanwhile, a further $30 million of state money will be earmarked for UTAS expansion projects in Burnie and Launceston and, if needed, Devonport's Living City makeover, taking the total state commitment to those projects to $90 million.

The bus and UTAS spends were revealed in Thursday's state budget, which contained a range of new and previously announced measures for the North-West and West.

Bus contracts going to the region are by no means certain, but Treasurer Peter Gutwein is keen for advanced manufacturers to tender.

"This is an exciting development for Tasmania's advanced manufacturing sector, and I would encourage them to bid for manufacturing, customisation and fit-out work arising from the program," Mr Gutwein said.

The project will provide 100 new buses.

Other regional highlights in the budget included:

$80 million over two years from TT-Line towards replacement of the Spirit of Tasmania ferries, as previously revealed by The Advocate;

helipads at the Mersey and North-West Regional hospitals ($1.4 million), which were foreshadowed last year but are now formally line items in the budget;

an as yet unknown amount of cash which could be in the order of $15 million towards a major visitor facilities upgrade at Cradle Mountain;

$6 million over four years to upgrade police housing, starting with the West Coast;

$1.75 million for contemporary learning areas at East Devonport Primary School, to be funded between 2018 and 2020; 

$3.6 million for a new general learning area at Somerset Primary School, to be funded between 2016 and 2018;

$313,000 for the Sheffield Family Support Centre;

$30,000 each for the Zeehan Neighbourhood House and the Rosebery Community House;

allocation of funding for the previously announced development of 15 new affordable housing lots at Somerset, 22 affordable homes in Devonport, six units for older people at Somerset and a supported accommodation for 25 people with disabilities in Burnie, plus $2.4 million for a new drug rehabilitation centre at Ulverstone.

The budget continues the funding roll-out for extending years 11 and 12 into state high schools.

Education Minister Jeremy Rockliff said 18 high schools would extend in 2017, including Burnie, Devonport, Latrobe, Reece, Sheffield, Ulverstone and Yolla.

Referring to the Cradle Mountain project, which would also need federal and private sector cash, Premier Will Hodgman said the government strongly backed the tourism industry because it "creates jobs and drives economic growth and showcases all that's great about our state".

He said the government expected North-West businesses to bid strongly for the bus work.

State Growth Minister Matthew Groom said the UTAS projects and Living City would bring much needed investment in the three cities and generate construction and ongoing jobs.

Roads projects funded included $6 million over three years to complete $8 million worth of Murchison Hwy improvements and $3.9 million for improvements to the Highland Lakes Rd.