Governor McMaster’s FY27 budget vetoes

On August 17, 2026, South Carolina Gov. Henry McMaster released his list of line-item vetoes in the budget approved by the General Assembly the previous week. 

Seven of the first nine vetoes are effectively cleanup vetoes. Several of these vetoes eliminate provisos that had already been passed into permanent law, making those one-year budget provisos no longer necessary. 

The remaining provisos were tied to programs that had been funded in previous years, with the funds already entirely expended. This highlights a major issue with the appropriations process: funds that have already been spent are not receiving sufficient scrutiny and are remaining in the budget when it reaches the governor for his signature. 

Almost all of these provisions were related to education in one form or another, with three specifically relating to charter schools. 

A good veto 

Veto 10 relates to grant forgiveness for the Town of Pacolet, which received a Department on Aging Senior Center Permanent Improvement Grant in 2013. The grant was for $350,000. The town received the grant, the project was not completed, and the funds were misappropriated. 

Gov. McMaster makes the case that the proviso sets a bad precedent by allowing local governments that fail to comply with the terms of a grant to have those obligations waived through the state budget. He is 100% correct. Local governments that accept state grants are obligated to fulfill the terms of those grants. 

However, the governor's vetoes are not all sunshine and rainbows. Two vetoes in particular deserve specific attention. 

Troublesome vetoes 

Veto 12 relates to funding for the Scout Motors plant. The General Assembly included language requiring a Legislative Audit Council review of cost overruns and additional vote by the legislature before appropriating an additional $150 million toward the project. 

The governor says that "the state must pay its bills," which is true. But that argument neglects the fundamental issue: the state has not yet authorized those increased funds through previous appropriations. The state should not be obligated to automatically provide additional taxpayer dollars simply because the cost of a project has increased, especially in a project that should have never involved the state in the first place. 

Here is the fundamental question as it relates to large corporate handouts: Should previously authorized funding be allowed to increase when costs rise, or should additional overruns require a fresh vote by the General Assembly? 

I think the answer is pretty clear when considering how the legislative process is supposed to work. The responsibility to allocate additional funds ultimately resides with the legislature. If a corporate welfare project requires another $150 million in taxpayer funding, the legislature should have the opportunity to review the costs and decide whether that additional expenditure is justified. 

The second problematic veto relates to a proviso designed to limit agency overspending. 

Veto 13 removes a proviso that would have prohibited state agencies and public institutions from spending, obligating or encumbering more money than the General Assembly authorized without additional legislative approval. 

McMaster argues that the proviso could create unintended consequences. He claims it would incentivize agencies to request more money than they actually need so they would not have to return to the legislature for additional approval. But this argument does not make a whole lot of sense because nearly every agency requests more money year after year. In other words, agencies are already asking for additional funding regardless of this proviso. 

Agencies do not want to have to return to the legislature every time they need approval for a spending increase. But that is precisely the point. The legislature, not the agencies, is responsible for deciding how much taxpayer money should be spent. If an agency needs more money than the General Assembly originally authorized, lawmakers should have the opportunity to determine whether that additional spending is justified. 

As stated earlier, the responsibility to allocate additional funds ultimately resides with the legislature. If an agency determines that it needs to spend more money than the General Assembly authorized, the legislature should have the authority to decide whether that additional spending is warranted. 

With the governor's line-item vetoes now released, the budget will return to lawmakers. The General Assembly will have to determine whether to override or sustain his vetoes. In doing so, lawmakers will help determine who ultimately has authority over the budget process: the executive branch and state agencies, or the legislature. 

While it is frequently stated (and somewhat true) that South Carolina is a legislative-dominated state, establishing the state's budget is not an abuse of legislative power. It is one of the legislature's most fundamental responsibilities. The power of the purse belongs to the General Assembly, and that responsibility should remain predominantly with the legislature.