Key Points for This Week
● Senate Rejects Tax Conformity
● House Advances Insurance Reform
● 18 Legislative Days Remain

The One-Minute Drill
The Big Picture: Four of the seven Republican Gubernatorial Candidates participated in the first GOP debate Wednesday. Senator Josh Kimbrell, Congresswoman Nancy Mace, Congressman Ralph Norman and Attorney General Alan Wilson engaged in a surprisingly civil debate. Questions included gambling, government spending, and tax cuts.

The Senate
Tax Conformity
In a bi-partisan vote, the Senate on Wednesday voted 27-16 to kill legislation that would change the state’s tax code to match federal tax law under President Trump’s “One Big Beautiful Bill.” The Senate’s decision defied both the House of Representatives unanimous vote and the urging of Governor McMaster. Opponents, including Senate Majority Leader Shane Massey (R-Edgefield), said the vote reflects letting South Carolina decide its own tax policy, He also said conformity undercuts tax cutting efforts, including those in the large scale income tax reduction bill, which would decouple our state tax code from the feds.

The Senate can still take up parliamentary procedures to reconsider the vote, and the House can continue to try to tack conformity language onto Senate bills residing in the House chamber. 

What Else?
By a vote of 32-9, the Municipal Tax Relief Bill received second reading in the Senate on Wednesday. The bill was amended and allows municipalities located in a county that has not enacted a sales and use tax to hold a referendum vote on a municipality-specific penny sales tax. The money is to be used for property tax relief (20%) and then other municipal infrastructure such as roads, bridges, other city facilities, civic centers, or police and fire stations. The referendum process is just like the county referendums and be held during a general election after 2026.

In a unanimous vote on Wednesday, the Senate approved legislation that will allow our technical colleges to offer four-year bachelors degrees in Culinary Arts Management. Across the state, the hospitality and tourism community has growing concerns for their workforce - this legislation will allow students to achieve four-year degrees and be better prepared to enter the culinary industry.

The House
House Passes Property & Casualty Insurance Reform
In a 96-7 vote, the House passed an expansive Property & Casualty Insurance Reform bill, the product of the Insurance Rate Reform ad hoc committee chaired this offsession by Representative Gary Brewer (R-Charleston). The bill increases oversight over insurance fraud, creates penalties for violations of policyholder protection.

What Else?
The House spent a significant amount of time Wednesday debating H.4764, legislation that requires all law enforcement agencies in the state that operate jails or detention centers to enter into cooperation agreements with federal Immigration and Customs Enforcement (ICE) operations. The bill quickly turned contentious and sparked hours of party-line debate over cost, safety and fears that national stories about the agency could come to fruition in South Carolina. The bill is headed to the Senate.

On Wednesday, the House also passed legislation that would increase penalties for people who hurt or harass police dogs and horses. The bill ultimately passed by a 106-2 vote, and is headed to the Senate.

In Committees
Foreign Ownership of Real Estate - H.3408
A House Judiciary Subcommittee amended and advanced a bill that would prohibit federally-defined foreign adversaries from owning, leasing, possessing or exercise any control over farm land in South Carolina.

DOT Reform - S.831/H.5071
The House Ways & Means Committee advanced the sweeping DOT Reform legislation Thursday morning. The House and Senate bill now include the same language that was originally in the Senate bill with their working language. 
​
The Week Ahead
In the Senate:
● The Senate will meet in perfunctory session next week, with no floor time, and limited committee meetings. The Senate Finance Committee will meet to outline their version of the 2026-2027 budget.

In the House:
● The House will be on Spring Break Round Two next week. They’ll return on April 14.

While there is no crossover deadline in the General Assembly, both bodies are nearing the point of the year in which they will unofficially only begin to consider legislation that has only passed one body, and many committees are expected to only have one to two more full committee meetings for the year. It will be a sprint after next week to get bills out of committees in what we expect to be about a two-week window.

Key Points for This Week
● Income Tax Reform Heads to Governor’s Desk
● Senate Amends, Passes School Bathroom Bill
● House Passes Limited Lawsuit Reform Measures

The One-Minute Drill
The Big Picture: On Wednesday, Senate President Thomas Alexander (R-Oconee) and House Speaker Murrell Smith (R-Sumter), ratified acts – a formal proceeding after a bill has passed both chambers. This week, that included H.4216, the income tax reduction bill, which is a major change in tax policy in this state. The bill now officially heads to Gov. Henry McMaster’s desk.

The Senate
School Bathroom Use Bill Passes
In a sweeping bipartisan vote of 33-2, the Senate advanced H.4756, legislation that would restrict bathroom, locker, and changing room use at public K-12 schools, colleges and universities to that which corresponds to a person’s biological sex at birth. The bill codifies language that already exists in state law under a budget proviso, but expands the application to colleges and universities and adds a private cause of action for violations. The bill was slightly amended by the Senate, so it will head back to the House to see if the body concurs in their amendments.

What Else?
The Senate advanced H.4763, the HALO bill, by a unanimous vote on Thursday. The bill prevents individuals from “approaching, impeding, causing harm to, or harassing” a first responder or emergency medical care provider. The Senate slightly amended the House version of the bill by removing the 25 foot perimeter. The bill was a Republican Caucus Agenda item in both bodies.

The House
House Passes Limited Lawsuit Reform Measures
While the House was expected to take up the Insurance Rate Reduction Act, the body instead tackled two pieces debated by the Judiciary Committee that limit lawsuit abilities in South Carolina. H.4760 deals with time-limited demands for settlements, setting a minimum amount of time of thirty days for an insured to respond. Representative Jay Jordan (R-Florence) who chaired the bill’s subcommittee said it’s to ensure bad actors can’t create artificial deadlines without guidelines and drag parties into bad faith claims. H.4544, medical malpractice legislation, modifies situations in medical malpractice cases where noneconomic damage caps do not apply, and adds a limit of 8x the current limitations on noneconomic damages to those situations. The bill also tweaks the definition of “occurrence.” Rep. Jay Jordan (R-Florence) said the bill aims to protect payments to ensure fair and timely compensation while preventing"excessive and unpredictable” lawsuits that can drive up healthcare costs.

Both bills passed the House unanimously and are headed to the Senate.

What Else?
The House voted unanimously to concur in Senate amendments to H.3858, a boat tax reduction bill, that would cut the property taxes paid on boats registered in SC by nearly half. The reduction would phased in over three years, and eliminate the requirement for owners to title an outboard motor. An updated fiscal impact study indicates that the cut will cut property tax revenue by nearly $40 million at the end of implementation.

The House voted to override Governor McMaster’s veto of H.4902, the name, image and likeness bill that would shield NIL contracts between colleges/universities and student athletes. The Senate is expected to take up the override next week.

In Committees
Bachelor’s Degree in Culinary Arts - H.5177/S.863
A House Ways & Means Subcommittee and a Senate Education Committee advanced pieces of legislation that would allow technical colleges to expand their culinary programs to bachelor’s degree programs. The House limits that ability to Trident Technical College only, while the Senate opens it up to all Technical Colleges.

DOT Reform - S.831/H.5071
A House Ways & Means Subcommittee advanced the sweeping DOT Reform legislation Thursday morning. The House replaced the language in the Senate bill with their working language.

Abandoned Buildings Tax Credit - S.853
A House Ways & Means Subcommittee advanced language that would clarify language on property types eligible for the Abandoned Buildings Tax Credit. The bill is headed to the full committee.

The Week Ahead
In the Senate:
● Floor Watch: The Senate is working on clearing their calendar before the budget, so we expect them to continue clearing smaller bills. Senators are hoping to get to the Municipal Penny Sales Tax legislation.
● Committees: Senate Finance subcommittees will wrap up their work on the state budget. Senate subcommittees will continue their work on data center regulation.

In the House:
● Floor Watch: The House did not take up H.4817, the Insurance Rate Reduction Act, this week as was expected. We assume the body will take up this legislation next week before furlough.
● Committees: The House will continue to work through committees to prep for floor debate following their second furlough week (the week of April 6). A Senate Judiciary Subcommittee will take up H.3408, legislation that would prohibit a business whos’ principal place of business is located in a U.S. declared foreign adversary (the People’s Republic of China, the Chinese Communist Party, the Russian Federation, Iran or North Korea), from owning, leasing, possessing or exercising control over any real estate in South Carolina.

Candidate Filing
Candidate filing remains open until Monday, March 30 at noon. 

Key Points for This Week
● DOT Reform Advances
● Hemp Consumables Legislation Advances
● Candidate Filing Opens

The One-Minute Drill
The Big Picture: The Senate passed its version of the sweeping DOT reform bill on Thursday, sandwiched between hours of lengthy debates over the Hemp Consumables Regulations bill.

1. Senate Advances Sweeping DOT Reform
The News: On Thursday, the Senate gave third reading to their sweeping DOT Reform Bill (S. 831), without adopting any of the previously carried over amendments.

● The Details:
○ Gives DOT greater ability to enter into public-private partnerships.
○ Expands DOT’s tolling authority.
○ Transfers National Environmental Protection Act (NEPA) authority for permitting to DOT from the Federal Highway Administration.
○ Allows counties and cities to take ownership of roads from the state.
○ Provides greater oversight over county transportation committees.

What’s Not Included: The Senate did not include language to make the DOT a cabinet agency under the governor. Several funding components of the bill were also removed, including an electric vehicle registration fee increase, electric car charging fee increases and mitigation fees for new housing developments.

What’s Next: The bill is headed to the House. If it follows the pattern the House established with their version of the DOT Reform bill, it will be referred to the Ways & Means Committee when the body gavels back in on Tuesday. From there, leadership will decide whether to add their language to this existing bill, or continue working through their iteration of the bill and hope for passage before the clock runs out.

The Senate Hemp Regulations Dominate Debate
The Senate spent the week debating H. 3924, legislation regulating hemp-derived THC products. For the first time in recent memory, the Senate went into the early morning hours Wednesday night (well Thursday morning), finally adjourning debate for the day at 12:15AM.

What happened?
The bill was amended throughout the week to permit entities to sell gummies and other hemp consumables, but restricted all sales to liquor stores only (as opposed to functioning much like beer/wine versus liquor with a milligram split. When time came to take a final vote on the bill, the legislation failed by a vote of 15-25, with Majority Leader Shane Massey saying the body expected to deal with the topic again on Thursday. 

And on Thursday? Thursday led to more behind-the-scenes negotiations with the Senate recessing for hour long periods of time to try to work out compromise language.

The bill finally passed late Thursday afternoon, restoring much of the language in the original version of the bill for convenience and grocery stores to sell hemp products at the 5% range, but behind a counter only. Gummies and other consumables can be sold, but only behind the counter. An additional amendment failed that would allow for and train servers to serve hemp based beverages at bars and restaurants.

Why It Matters: The debate exposed cracks within the Republican party and leadership. Additionally, these new restrictions will impact retailers and many bars and restaurants that are currently serving these products.
The House The House was on Spring Break this week… the first of two planned furlough weeks they’ll take before the end of the session.

In Committees
Municipal Tax Relief - S.866
The Senate Finance Committee advanced legislation that would allow a municipality to hold a referendum to enact a penny sales tax within municipal boundaries if their county does not currently have a penny sales tax.

Childcare Programs - S.770
A Senate Family & Veterans Services Committee took testimony on a bill that would expand access to certain childcare programs for individuals with certain income caps and employment. The bill was ultimately carried over. 

Regulatory Reform - S.254/H.3021
A Senate Judiciary Subcommittee continued to take testimony on bills that would lessen regulatory burdens on small businesses. No action was taken.

The Week Ahead
In the Senate:
● Floor Watch: The Senate will likely take up the tax conformity bill and the transgender bathroom bill.
● Committees: Senate Finance subcommittees will wrap up their work on the state budget. 

In the House:
● The House will begin heavy committee work again as they work to fill the calendar for the second half of session. 

Candidate Filing Opened
Candidate filing opened on Monday at noon for all partisan offices (non-partisan offices such as school board will open in August). Filing closes on March 30 at noon.

Key Points for This Week
● House passes $15.4B state budget
● Income tax reform heads to Gov. McMaster
● DOT reform advances in the Senate

The One-Minute Drill
The Big Picture: The General Assembly has reached the midpoint of the legislative session, with nine weeks remaining before the May 14 Sine Die deadline. Expect longer days and faster legislative movement as lawmakers work to finish major priorities before adjournment.

1. House Passes $15.4 billion Budget
The News: After about 16 hours of debate, the House approved its first version of the $15.4 billion state budget. Despite the lengthy debate, the process moved faster than in recent years, with lawmakers finishing before midnight both nights. The Senate now begins its review.

What’s in the budget
State Workers
● $66.9M for a 2% pay raise for state employees
● $36.7M for the State Health Plan, avoiding premium increases
Education
● $150M to raise starting teacher pay to $50,500
● $95M for K-12 public and charter school facility and safety upgrades
● $8.7M to fully fund school breakfast statewide
Infrastructure
● $500M for roads and transportation
○ $249.2M for bridge modernization
○ $125M for interstate acceleration
○ $100M for county transportation funding
○ $25M for the road buyback program
Economic Development and Tourism
● $70M for airport enhancements to strengthen freight capacity and tourism
● $40M for tourism marketing
Tax Relief and Reserves
● $125M to reduce the top income tax rate from 6% to 5.39%
● $130M for property tax relief
● $179M added to the state’s reserve funds

What’s not included: The House version does not include earmarks or the $150M requested by the Department of Commerce for the Scout Motors project. 

What’s next: The Senate Finance Committee is expected to begin work on the budget in early April, where changes are common.

Why it matters
● Continued tax relief remains a legislative priority.
● Infrastructure funding signals ongoing focus on freight mobility and economic growth.
● The Senate budget process still provides opportunities for major revisions.

2. Income Tax Reform Heads to McMaster’s Desk
The news: After finishing the budget debate Wednesday night, the House approved the Senate’s income tax reform proposal, sending it to Gov. Henry McMaster.

Immediate changes
● Cuts the top income tax rate from 6% to 5.21%
● $308M in immediate income tax relief
● Taxes the first $30,000 of taxable income at 1.99%
● Existing exemptions remain unchanged

Impact: More than 77% of taxpayers are expected to see either a tax cut or no change in their tax liability.

​Long-term goal: The legislation commits to future incremental reductions, moving toward a 1.99% flat tax rate and potential elimination of the state income tax.

Why it matters
● Lower income tax rates can improve South Carolina’s competitiveness for investment and talent.
● Updated withholding tables mean workers may see higher take-home pay sooner, which can influence consumer spending.
● Future tax reductions will likely remain a major policy focus in upcoming sessions.

The Senate
DOT Reform
● The Senate gave S.831, the comprehensive Department of Transportation reform bill, second reading this week.
● Debate on amendments was carried over to third reading, which leadership expects to take up after completing debate on hemp beverage regulations.
● DOT governance changes could affect transportation planning, project prioritization, and infrastructure investment statewide.

Hemp Beverage Regulation
The Senate spent the week debating H.3924, legislation regulating hemp-derived THC products.
Key provisions
● Prohibits sales to individuals under 21, but keeps CBD products legal
● Places hemp beverages within the state’s three-tier alcohol distribution system
Product Limits / Restrictions
● 5mg THC drinks could be sold wherever beer and wine are sold
● 10mg drinks would be regulated similarly to liquor
● No on-premise consumption at bars or restaurants
● Gummies and other hemp consumables banned

Why it matters: The bill could significantly affect retailers, distributors, restaurants, and beverage manufacturers, particularly around where hemp beverages can be sold and how they are distributed.

The House
Tax Conformity
● After the budget and the income tax bill, the House passed tax conformity – aligning the state tax code with the federal tax code for 2025. One year only.
● This will include no tax on tips, no tax on overtime, and other provisions from the Big Beautiful Bill (2025). It will cost the state hundreds of millions in one-time money.
● This will also include full expensing of domestic research and experimental costs.
● The bill now goes to the Senate Finance Committee. 

In Committees
Municipal Tax Relief: S.866
A Senate Finance Subcommittee advanced legislation that would allow a municipality to hold a referendum to enact a penny sales tax within municipal boundaries if their county does not currently have a penny sales tax.

Pharmacy Benefit Managers: S.342
The Senate Banking and Insurance Committee advanced legislation that would further regulate pharmacy benefit manager programs and set a minimum drug reimbursement price and a $10.50 minimum dispensing fee for all prescriptions filled. This legislation will cost residents $300 million per year and increase health insurance premiums by 3%.

The Week Ahead
In the Senate:
● Floor Watch: The Senate is expected to continue their work on Hemp regulation and DOT reform.
● Committees: Senate Finance subcommittees will work on the state budget.
​
In the House:
● The House will take their first of two furlough weeks next week.

Key Points for This Week
● House preps for marathon week
● Training for alcohol service heads to McMaster’s desk
● DOT reform heads to senate floor

The One-Minute Drill
The Big Picture: We’ve hit the point in the two-year legislative session when the two chambers are starting to get really ticked off at the actions of the other. This happens every session, but the stakes are pretty high this year. Tax cuts, conformity, and the budget are serious challenges for the House in a gubernatorial election year.

1. House Preps for Marathon Week
The News: On Thursday, the House set four bills for Special Order next week - meaning no other legislation can be taken up before the completion of these bills. Members are prepping for a long week of debate, with the House gaveling in at 1:00 p.m. on Monday and possibly staying in session for the entire week.
● The Details: First on the agenda is the budget (H.5126). They’ll take up the “non-controversial” sections and then move into sections with amendments and lengthy debates. In past years, this process has stretched well into the night for several days. Following the budget, the House will take up the state’s rainy-day funds. Unlike past years, this isn’t where debate will end. The House will then take up the amended income tax reduction bill (H.4216), and the notorious “tax conformity” bill to extend Trump’s tax cuts for the 2025 tax year (H.3368).
● The Rub: The Senate’s version of the Income Tax bill increases the fiscal impact, leaving the House with even fewer funds to allocate in this year’s budget process. The House will need to decide whether to concur with the Senate’s amended version – both options being problematic in an election year. Meanwhile, tax conformity isn’t something the Senate wants to take up since the newly passed income tax bill decouples SC Income Tax from Federal taxes, but that would keep state taxes on tips and overtime, which is not popular. 
● What’s Next: These spats during the budget process aren’t unusual. Political watchers are placing bets on whether we see a budget done before June’s primary elections, especially given that the Senate has already passed a Continuing Resolution.

2. DOT Reform Heads to Senate Floor
The News: The Senate Advanced DOT Reform to the floor, and is expected to be taken up after the Senate finishes their work on Hemp Legislation.
● The Details: The Bill was amended in full committee and:
○ Gives DOT greater ability to enter into public-private partnerships.
○ Expands DOT’s tolling authority.
○ Transfers National Environmental Protection Act (NEPA) authority for permitting to DOT from the Federal Highway Administration.
○ Allows counties and cities to take ownership of roads from the state.
○ Provides greater oversight over county transportation committees.
● What’s Not Included: The Senate did not include language to make the DOT a Cabinet department under the governor. Several funding components of the bill were also removed, including an electric vehicle registration fee increase, electric car charging fee increases and mitigation fees for new housing developments.

On The Floor
Judiciary Race
● Justice Few Withdraws: In a surprise announcement on Tuesday, Supreme Court Justice John Few withdrew from the race for his seat on the bench. As the incumbent, his withdrawal forced a cancellation of the race and reset the process. Few’s term is set to expire on July 31, but law says he can stay on the bench until his replacement is selected - likely in 2027.

House
● “HALO” Act: The House passed legislation (H.4763) that would require the public stand 25-feet away from first responders and law enforcement if given a verbal warning. Knowingly ignoring that warning either from medical or law enforcement personnel would result in a misdemeanor charge, punishable by a fine of up to $500 and up to 30 days in jail. 

Senate
● Alcohol Server Training Extension: This week, the Senate unanimously passed H.5261, a joint resolution to extend the deadline for restaurants and bars to comply with the new alcohol server training requirements (as outlined in last year’s alcohol regulation overhaul) to May 1st. The Resolution is headed to the Governor’s Desk.
● Boat Taxes: On Thursday, the Senate passed a bill that aims to restructure boat taxes and registrations. The Senate-amended bill, which would eliminate the requirement to register outboard motors and reduce boat taxes by roughly $50 million, now heads back to the House.

In Committees
Data Centers: S.867/S.902
A Senate Agriculture and Natural Resources subcommittee and a Senate Judiciary subcommittee met this week to discuss the “Data Center Development Act” (S.867) and the “Data Center Siting Act” (S.902). Testimony during these hearings focused on water and energy usage and on which entities should have governing and regulatory authority. Additional hearings are expected.

Regulatory Relief: H.3021/S.254
A Senate Judiciary subcommittee held another hearing on a bill that seeks to reduce regulatory burdens on job creators by requiring agencies to eliminate two regulations for every new one proposed, ending judicial deference to state agencies in legal disputes, establishing a regulatory “shot clock,” and implementing other reforms. Additional hearings are expected.

Insurance Reform: H.4817
The House Labor, Commerce and Industry (LCI) Committee advanced a bill that aims at reducing insurance rates, combating fraud, and increasing policyholder protections. The bill now heads to the House floor. 

Chinese Land Ownership: H.4974
A House Medical, Military, Public and Municipal Affairs (3M) subcommittee advanced a bill that would restrict companies owned or controlled by the People’s Republic of China or the Chinese Communist Party or whose principal place of business is located within China from acquiring land within 25 miles of military installations for the purpose of installing telecommunications or broadcast towers. The bill sent to the full House 3M Committee.

The Week Ahead
In the Senate:
● Floor Watch: The Senate is expected to take up legislation that would regulate hemp based consumables. The bill (H.3924) passed the House in April 2025, but has been heavily amended since then by the Senate. 
● Committees: Senate Finance subcommittees continue to meet in the Senate as they begin their work on the state budget, and an Agriculture and Natural Resources subcommittee will continue taking testimony on S.867, the data center overhaul bill. The full Senate Banking and Insurance Committee will meet on Wednesday to discuss S.342 the Pharmacy Benefit Manager Bill that will add a minimum dispensing fee to all prescriptions dispensed in SC.

In the House:
● Floor Watch: The House will spend the week on the budget, capital reserve funds, income tax reform and tax conformity.
● Committees: No House committees will meet this week.

Key Points for This Week
● Senate Amends (and passes) Income Tax Reform
● Training for alcohol service
● DOT reform moves in Senate

The One-Minute Drill
The Big Picture: Income Tax reform advances, hospitality community gets a break, DOT reform moves in the Senate with no new taxes included in the bill.

1. Senate Amends and Advances Income Tax Reform
The News: The Senate advanced H.4216, the income tax reduction bill, by a vote of 39-5.
● The Details: The SC Senate amended and advanced the income tax reduction bill on Tuesday, with the amendment coming from a surprise source - Senator Lee Bright (R-Spartanburg), co-sponsored by Chairman Harvey Peeler (R-Cherokee). The amended bill accelerates the tax reduction process.

The amended version of the bill:
○ Eliminates the federal standard and itemized deductions, and lets state taxpayers claim a state income adjusted deduction
○ Shifts the state's 6% top income tax rate down to 5.21%
○ Requires that anyone with taxable income of up to $30,000 pay 1.99%
○ Requires that anyone with taxable income above $30,000 pay 5.21%
○ Phases the income tax to zero, if the state takes in enough revenue, but this could take decades.

● The Cost: The House version hit the state budget revenue in year one by $119 million. The Senate doubled that to $308.7 million, which will have a big impact on the budget as they continue to work through the FY 2027 budget process.
● What’s Next: The amended bill now heads back to the House for concurrence. If they opt not to concur, the bill will head to conference committee where three appointees from the House and three from the Senate will hash out the details.

2. Alcohol Training Courses
The News: On Wednesday, the House introduced a Joint Resolution (H.5261) extending the deadline for bars & restaurants to complete State-Mandated alcohol-serving courses, which were supposed to be completed by Monday. However, only about 20% of establishments have been able to complete the courses. Meaning 80% of these business would be operating illegally beginning Monday.
● The Details: Legislation in the alcohol regulation passed last year required bars and restaurant owners to have their staff complete alcohol training and safety courses. However the Department of Revenue failed to create the courses in a timely manner. The new resolution extends the deadline until May.
● What’s Next: The bill was fast tracked on Wednesday, with the body waiving the usual committee procedure. The Senate should get the resolution next week, and the hope is that the Senate will also fast-track the resolution, getting it done by late next week.

On The Floor
House
● 10 Commandments: The House spent Wednesday debating a bill that would require the 10 Commandments to be posted in schools. The legislation passed by a party-line 84-31 vote and requires at least an 11-by-14 inch Ten Commandments poster to be displayed in every K-12 public school and college classroom no later than January 2027. The language mentions other historical documents — the Emancipation Proclamation, the Declaration of Independence, the Mayflower Compact, and the Northwest Ordinance — can also be displayed. 

Senate
● Name, Image & Likeness Wraps: A Senate Education subcommittee held some college athletic directors’ feet to the fire on Wednesday to ensure that public money was not being used toward Name Image and Likeness (NIL) deals for athletes in South Carolina, as they continue to debate whether or not these deals should be transparent for public view. Athletic directors told a South Carolina Senate committee on Wednesday that no "direct institutional support" from their respective colleges goes toward the revenue-sharing program with university athletes. The bill received third reading on Thursday and is headed to the Governor’s desk.
● Abandoned Buildings Tax Credit: The Senate also passed a bill (S.853) that clarifies eligibility rules for these tax credits in response to a S.C. Department of Revenue (DOR) ruling released earlier this year. Attempts to restrict data centers from utilizing the credit were defeated. The bill now heads to the House.

In Committees
Pharmacy Benefit Mangers: S. 342
A Senate Banking & Insurance Subcommittee advanced legislation that seeks to regulate Pharmacy Benefit Managers, and adds a dispensing fee to every prescription filled. This could cost South Carolinians an additional $330 million per year.

DOT Reform: S. 831/H. 5071
A Senate Transportation Subcommittee passed their DOT Reform bill, stripping out all new taxes and fees, leaving those for the House to tackle (by constitutional mandate). The House’s companion bill is awaiting a hearing in the House Ways & Means Committee.

“Clean Air Act”: H. 4624
A House Ag subcommittee took testimony Wednesday on a bill that would regulate aircraft emissions, stating no one can "inject, release, or disperse" any chemicals, or "apparatus and energy frequencies manipulation" in the state's atmosphere with the goal to affect temperature, the dimming of sunlight or storm intensity. The bill was carried over.

Notable Introductions
H1B Visas: H. 5273
This bill by Rep. Steven Long (R-Spartanburg) would bar companies from receiving state incentives, tax breaks, grants, FILOT agreements, or state contracts if more than 2% of their workforce are H-1B visa holders. The bill was referred to the House Ways and Means Committee.

E-Verify Penalties: H. 5279
This bill by Rep. Steven Long (R-Spartanburg) would increase penalties for private employers who violate state employment citizenship verification requirements, raising fines and other sanctions for hiring unauthorized workers. The bill was referred to the House Labor, Commerce, and Industry Committee.

Data Center Moratorium: H.5286
This joint resolution by Rep. Steven Long (R-Spartanburg) would enact a two-year moratorium on new data center construction in the state. The joint resolution was referred to the House Ways and Means Committee.

The Week Ahead
In the Senate:
● Floor Watch: The Senate is expected to continue to fast track the alcohol server bill from the House (above). Other bills on the calendar include a bill that relates to Medical Informed Consent protocols (S.343) and hemp regulation (H.3924).
● Committees: Senate Finance subcommittees continue to meet in the Senate as they begin their work on the state budget, and an Agriculture and Natural Resources subcommittee will continue taking testimony on S.867, the data center overhaul bill. The full Senate Transportation committee will meet to discuss the DOT reform bill (S.831). A Senate Judiciary Committee subcommittee will meet Thursday to discuss the “Small Business Regulatory Freedom Act” (H.3021).

In the House:
● Floor Watch: The House will continue to work to clear the calendar next week in preparation for the budget debate. Bills on the calendar include magistrate election reform (H.3530) and various education bills.
● Committees: The House Ad Hoc committee on Tort Reform will meet Tuesday afternoon to discuss Medical Malpractice (H.4544) and Time Limited Demands (H.4670).

Calendar Update: The House plans to take two weeks of furlough (weeks of March 16 and April 6). The Senate is expected to take the Thursday before Easter off, and be in a perfunctory session the week of April 6, meaning no floor work. The Senate expects to work in committee that week, since the Senate Finance Committee will need to finalize the budget.

Key Points for This Week
● House Ways & Means Budget Proposal
● Senate Passes Property Tax Reforms

The One-Minute Drill
The Big Picture: The General Assembly wrapped Week 6 with 36 legislative days remaining. The House floor was quiet this week to allow the House Ways & Means Committee to complete their work on the budget, while the Senate resumed their debate on tax relief bills.

1. House Ways & Means advances $15.4 billion budget
The News: The House Ways & Means Committee unanimously voted to approve sending their version of the $15.4 billion general fund spending plan to the floor.
● The Details: This is the first draft of the budget, and was more austere than expected.
●The Catch: The budget included assumptions for the revenue needed to fund the Senate’s homestead exemption property tax bill (see below), and the House’s income tax bill as well as tax conformity – all of which eat at large chunks of the available recurring revenue. Chairman Bruce Bannister (R-Greenville) and the subcommittee chairs emphasized the budget is a “process” and this is the earliest draft of the budget, hoping for additional funds to allocate later this spring. Though recent RFA estimates show there may not be more revenue available as some segments of tax collections appear to be slowing quickly.

● What’s in:
○ $500 million for infrastructure projects
○ $150 million to increase starting teacher pay to $50,500
○ $175 million for the MUSC’s cancer hospital
○ $66.9 million for a 2% raise for state employees

● What’s Out:
○ Member requested projects (those will be taken up in H2 if revenue permits)
○ The $150 million requested by the Department of Commerce to offset cost overruns associated with the Scout Motors project.

● What’s Next: The budget will now be printed and placed on the members desks for the body to review and prepare amendments. The body will debate the bill the week of March 9. The Senate will then run through their budget process, before the House takes a final stab at the spending plan in May.

2. Homestead Exemption
The News: After significant debate, the Senate unanimously passed S.768, a bill that expands the homestead exemption on primary residence property taxes for anyone 65 and older.
● The Details: The bill increases the property tax exemption from $50,000 to $75,000 for anyone 65 and older who moves to SC and lives here for 5 years, and then a full expansion of $150,000 after 10 years (current residents do not have to meet the residency requirement).
● The Guardrails: The bill contains a non-severability clause - meaning if the state or US Supreme Court strikes down a part of the bill (residency requirement clauses are being challenged across the country), the entire bill goes down with it.
● The Aftermath: Debate brought up significant questions and concerns around South Carolina’s property tax structure, and housing affordability, especially for younger professionals. Chairman Harvey Peeler (R-Cherokee) has appointed Senator Sean Bennett (R-Dorchester) to spearhead a new Senate Subcommittee focused on tax reform, and affordability is expected to be a large part of the conversation.

On The Floor
House
● Maximum Unemployment Benefits: The House unanimously passed a bill that would index unemployment based on the current unemployment rate.

Senate
● Name, Image and Likeness: After passing fast-tracked legislation (H.4902) that would shroud details of Name, Image and LIkeness Deals obtained by college students by a vote of 30-13 on second reading Tuesday, the body did an about-face on Wednesday during what is normally a perfunctory vote on third reading. The issue? Transparency.

In Committees
Data Centers: S.867 
A Senate Ag Subcommittee took testimony on the bill, with additional meetings planned for next week.
Concurrency: H.4050
Various concurrency proposals are in committees (and various bills) to regulate development based on available infrastructure. The future of these proposals appears to be dim in this session.

The Week Ahead
In the Senate:
● Floor Watch: Expect a heavy focus on the Income Tax Reduction Bill (H.4216).
● The Budget: Subcommittees will continue to meet in the Senate as they begin their work in preparation to take up the budget in late April.
●Prescription Drug Pricing: A LCI subcommittee will meet Wednesday to debate S.342, a proposal that would dramatically increase prescription drug costs in the state.
● Data Centers: An Agriculture and Natural Resources subcommittee will continue taking testimony on S.867, the data center overhaul bill.
● DOT Reform: A Senate Transportation subcommittee will meet again, and is expected to advance their version of the department overhaul to full committee.

In the House:
● Floor Watch: We expect the House to continue to clear the calendar in preparation for their work on the budget. There are several bills still on the contested calendar that could make for lengthy debate including Hemp regulation (H.4758) and a bill regarding the display of the 10 Commandments in schools (H.4762).

Key Points for This Week
● McMaster Endorses Evette for Governor
● Senate debates Property Tax Reforms
● House Passes SC Small Business Tax Cut of 2026
● House Passes Judicial Reform

The One-Minute Drill
The Big Picture: The General Assembly wrapped Week 5 with 40 legislative days remaining. While the floor was quieter this week, major movements in judicial reform and small business tax relief defined the agenda.

1. The Governor’s Race: McMaster Picks a Side
The News: Governor Henry McMaster officially endorsed Lt. Gov. Pamela Evette to succeed him.
● Why it matters: As the state's longest-serving governor, McMaster’s nod cements Evette as the institutional frontrunner in a crowded GOP field. 
● What’s next: Eyes are on Mar-a-Lago. The Trump endorsement for Cody Simpson could signal the former President intends to influence other state races this June.

2. Judicial Reform: A Historic Shift
The News: The House passed a sweeping overhaul of the Judicial Merit Selection Commission (JMSC) on a party-line vote.
● The Details: The bill expands the JMSC to 12 members – all appointed by the Governor.
● Key Guardrail: It explicitly bans using "diversity, equity, and inclusion (DEI) criteria" (including race, gender, or religion) in judicial nominations.
● The Hook: In a late amendment, the Senate must now send magistrate candidates to the JMSC for review before confirmation. 

3. Small Business Win: $10,000 Tax Exemption
The News: The House passed the SC Small Business Tax Cut of 2026 (H.5006) 103-0.
● What it does: Exempts the first $10,000 of depreciated business personal property (desks, equipment, etc.) for companies with fewer than 100 employees or under $10M in sales.
● Bottom line: It eliminates property tax entirely for thousands of the state's smallest "mom and pop" shops.

Senate: Taxes & Oversight
● Charter School Oversight (S.454): Passed unanimously. It grants the Dept. of Education more teeth to oversee for-profit management companies and authorizers following a critical audit.
● Property Tax (S.748): Debate began on Chairman Peeler's "Homestead Exemption" bill. It seeks to jump the exemption to $150,000 for seniors (65+).
○ The Friction: Senate debate centered on updating the property tax system, and "workforce vs. retirees" – specifically whether this encourages an influx of retirees at the expense of affordable housing for workers. 

In Committees
DOT Reform: S.831 / H.5071
Both chambers are taking testimony; Senate version stalled by the clock this week.
NIL Contracts: H.4902
Advanced to Senate floor. Aimed at keeping SC colleges competitive by reducing NIL disclosure requirements.
Alcohol Sales: H. 3857/ H. 4001 / H. 5017
House subcommittees advanced curbside delivery, Sunday sales referendums, and Sunday liquor tastings.

Other Bills of Note:
House: The "Scarlet E" Housing Reform (H.4270)
● The News: A bipartisan bill to seal old eviction records cleared its first major hurdle on Tuesday with a unanimous 5-0 subcommittee vote.
● What it does: The bill (H.4270) would automatically remove eviction filings from the public searchable index after five years (down from seven in the original draft).
● Why it matters: In South Carolina, an eviction filing currently stays on a record forever—even if the case was dismissed. Business and housing advocates call it the "Scarlet E," which often prevents reliable workers from securing housing due to ancient or erroneous filings. The bill has support from both tenant groups and the SC Apartment Association, who agree that five-year-old data is no longer useful for screening.
● Status: Heads to the full House Judiciary Committee with 18 bipartisan co-sponsors.

Higher Ed Tenure Review (H.4761)
● The News: A House Higher Education subcommittee is advancing a proposal that would mandate a "post-tenure review" for faculty at public colleges and universities. This is a reaction to the public comments from some faculty about the assasination of Charlie Kirk last fall. 
●The Details: The bill (H.4761) requires tenured professors to undergo a comprehensive performance evaluation every six years. If a faculty member receives two "does not meet expectations" ratings within five years, the university must initiate a tenure revocation process within six months.
● Why it matters: Supporters argue this ensures accountability and "weeds out dead wood" in state-funded positions. Critics, including many faculty groups, contend it effectively ends the "lifelong guarantee" of tenure and could hurt the state's ability to recruit top-tier researchers.
● What’s next: The bill is a top priority for the leadership of both chambers.

The Week Ahead
In the Senate:
●Expect a heavy focus on the Income Tax Reduction Bill (H.4216) and continued debate on Homestead Exemptions.
● Tech Watch: A subcommittee will take testimony on S.867, the comprehensive Data Center bill.

In the House:
●Floor Watch: H. 3477 Changes the calculation of how much money beneficiaries can get through unemployment insurance benefits. H. 4757 creates the so-called Parental Rights Act, an outline of a framework so to speak of a parent's role in the education, health care and mental health care of their child. Both are priorities for leadership this session.
● The Budget: The Full Ways & Means Committee takes center stage to begin "section-by-section" work.
● Solicitor Impeachment: A subcommittee will discuss the potential impeachment of the 5th Circuit Solicitor.

 The Senate
On the Floor: The Senate finished their work on S. 52, the DUI reform bill, with third reading wrapping up on Thursday. Also of note, the body quickly and unanimously passed an interesting joint resolution
(S. 880). The resolution states that if a member of the General Assembly submits their resignation prior to March 1, 2026, the special election to fill their vacancy will run concurrently with the candidacy filing and election schedule for the 2026 election for the members of the House of Representatives. This led many to ask the obvious question of who is resigning? Senator Wes Climer (R-York) answered that question over the weekend in a long social media post. Climer has already announced that he is running for the Fifth Congressional District seat being vacated by Ralph Norman, who is running for Governor.

Moving ahead, the Senate is expected to turn its focus to income tax reform and charter schools.

Committee Work:
DOT Reform
A Senate Transportation subcommittee met again this week to continue discussions on their version of the SC DOT Modernization bill, S. 831. No action was taken this week, and the subcommittee plans to continue to meet.

Data Centers
Data centers became a topic of contention during the Energy Modernization Debates, and is expected to remain a top priority for the body this year. A Senate Agriculture and Natural Resources Committee subcommittee held the first meeting on (S. 867), a bill that would establish a statewide framework for the siting, permitting, and regulation of data centers, including new infrastructure, energy, and environmental requirements, and tax incentive provisions.

Regulatory Reform
A Senate Judiciary Committee subcommittee took additional testimony on a bill (H. 3021) that seeks to reduce regulatory burdens on job creators by requiring agencies to eliminate two regulations for every new one proposed, ending judicial deference to state agencies in legal disputes, establishing a regulatory “shot clock,” and implementing other reforms.

Pharmacy Reimbursement Mandates
On Thursday, a Senate Banking & Insurance Committee subcommittee held a hearing on a bill (S. 342) that would set minimum reimbursement rates for how pharmacy benefit managers (PBMs) pay pharmacies and pharmacists for dispensing prescription drugs or performing pharmacy services, ultimately leading to increased prices for payers. The bill was carried over.

Confirmation Hearings
A Senate Judiciary Subcommittee, chaired by Sen. Jason Elliott (R-Greenville) gave a 5-0 confirmation to Cindy Crick to be the 13th Circuit Solicitor (Greenville and Pickens counties). The confirmation now goes to the full Judiciary Committee in the next couple of weeks. She has been serving in an acting role as solicitor since Gov. McMaster appointed her last August.

The House
On the Floor: The House spent significant time on the floor this week working through a bill that would limit access to abortion medication, ultimately passing the bill Wednesday afternoon. They also spent most of the afternoon and evening working through legislation that would regulate and ban hemp-derived products. The bill to regulate ultimately failed, resulting in a loss for House Republican Leadership with members of the Freedom Caucus and Democratic Party working together to send the bill back to the House Judiciary Committee. 
​
Committee Work:
House Ways & Means Committee:
Budget subcommittees continued to meet in a race to finish the budget. On Tuesday, the full House Ways and Means committee advanced the “State of South Carolina Small Business Tax Cut of 2026” (H. 5006). The bill exempts the first $10,000 of a small business’s personal property taxes and excludes the first $50,000,000 of equity contributions from the corporate license fee taxes. The committee also advanced legislation linking the duration of unemployment benefits to the statewide unemployment rate (H. 3477). The approach is intended to encourage faster re-employment during periods of low unemployment, help address workforce shortages, and reduce unemployment insurance taxes.

House Judiciary Committee:
A House Judiciary committee advanced two pieces of legislation that would impact judicial selection and appointments this week. The first, H. 4755, aims to reduce legislative influence over the Judicial Merit Selection Committee. The second, H. 3530, modifies magistrate selection and qualifications, including the requirement of a juris doctorate and to be in good standing with the South Carolina Bar. This has been a key sticking point for the business community for a long time, since so much business litigation goes through the magistrates.

Additionally, a judiciary subcommittee took testimony on several bills that deal with businesses’ ability to deliver beer, wine and liquor either curbside or to a home. The practice was allowed during the COVID-19 pandemic and retailers and restaurateurs say it will give increased flexibility to their customers. The subcommittee will meet to take additional testimony next week.

DOT Reform
The House Ways & Means Revenue Policy Subcommittee met this week to take testimony from DOT on H. 5071, their version of the DOT Reform bill. Chairman Bannister indicated that the committee will be continuing to meet to take testimony on the bill before taking time for amendments. The subcommittee is scheduled to meet again on Wednesday.

Notable Bill Introductions
S. 878 (Industrial Retail Choice) – Creates a framework allowing certain large electricity customers to procure power from third-party suppliers, subject to transmission, cost-allocation, and regulatory requirements.
H. 5122 (Broadband Equipment Sales Tax Exemption) – Creates a sales tax exemption for certain equipment, supplies, and machinery sold to internet access service providers and communications service providers for use in producing or distributing internet and communications services.

Looking Ahead
The Senate
The Senate is expected to take up Charter school regulation language and the Income Tax Reduction bill on the floor next week. Senate Finance Subcommittees will begin meeting in preparation for the budget and testimony will also continue on the DOT Reform bill.

The House
The House is expected to take up the Small Business Tax Cut Bill, as well as the Unemployment Benefit Indexing Bill next week. Judicial Merit Selection Reform will also be on the calendar. Budget subcommittees will hold their final meetings in preparation for the budget, which is still slated to be in the full Ways & Means Committee next week. Subcommittees will continue to meet to take testimony on the DOT reform bill and alcohol curbside pick up and delivery bills.

Last week was a slightly less busy week as the General Assembly took a day off because of the winter weather and the Senate and House assembled Wednesday evening to hear Governor McMaster’s final State of the State Address.
 
The Politics
State of the State: Governor McMaster largely took a victory lap in his final State of the State Address Wednesday evening, talking about the economic investments during his term, the policy achievements, and a history lesson as we head into the 250th Anniversary of the United States.
 
Of note from the speech:

• The Governor continued to beat the drum of infrastructure improvements.
• He said if a full income tax cut made it to his desk, he would sign it.
• Called for more funding for universal 4K across the state and more scholarships for college students attending our technical colleges.
• He recommended that the state pay for an outside analysis of growth and what will be needed to keep up. The Census Bureau said this week that South Carolina was the nation’s fastest-growing state.

McMaster, the longest-serving governor in state history, is term-limited, but he got two extra years when he ascended to the governor’s office following President Trump’s appointment of then-Gov. Nikki Haley to be the US Ambassador to the United Nations. Governor McMaster’s term will end in January 2027.
 
The Senate
On the Floor:
The Senate continued their work on S.52, the DUI reform bill, with debate lasting into the day on Thursday. Since the bill was set for special order, the body did not debate any additional significant legislation during this short week.
 
Committee Work:
Committee work in the Senate was lighter than past weeks, given Tuesday’s cancelled session and the State of the State address. Of interest was the Senate Transportation Committee meeting on Thursday, discussing DOT modernization.
 
DOT Reform
A Senate Transportation subcommittee met this week to continue discussions on their version of the SC DOT Modernization bill, S.831. This week’s meeting focused on housing affordability, congestion, and a proposed increase to the electric vehicle fee. Another hearing is set for next Wednesday, with the subcommittee chairman emphasizing this week that the committee would move slowly through the various sections of the bill before taking up any amendments.

The House
On the Floor:
The House spent the majority of their time on the floor this week debating H.4756, the Student Personal Privacy bill. While debate looked like it could go well into the night on Wednesday, the break for the State of the State address gave time for a compromise to be reached, and debate to conclude on Thursday. The bill passed on a party line vote and is headed to the Senate.

The House also spent time clearing remaining bills off of the calendar, recommitting several bills back to their respective committees, including legislation that would pave the way for the first casino in South Carolina.
 
Committee Work:
The House continued to hold numerous Ways & Means budget subcommittee meetings in preparation for the budget.
 
Business Personal Property Tax:
On Thursday, a House Ways and Means subcommittee advanced the “State of South Carolina Small Business Tax Cut of 2026” (H.5006). The bill exempts the first $10,000 of a small business’s personal property taxes and excludes the first $50,000,000 of equity contributions from the corporate license fee taxes. The bill is headed to the full Ways & Means Committee on Tuesday.
 
Maximum Unemployment Benefits:
The same House Ways and Means subcommittee advanced legislation linking the duration of unemployment benefits to the statewide unemployment rate (H.3477). The approach is intended to encourage faster re-employment during periods of low unemployment, help address workforce shortages, and reduce unemployment insurance taxes. The bill now heads to the full Ways and Means Committee. Similar legislation has passed the House in prior sessions but has stalled in the Senate.
 
Judicial Reform:
A House Judiciary subcommittee advanced two pieces of legislation that would impact judicial selection and appointments this week. The first, H.4755, aims to reduce legislative influence over the Judicial Merit Selection Committee. The second, H.3530, modifies magistrate selection and qualifications, including the requirement of a juris doctorate and to be in good standing with the South Carolina Bar. Both bills are headed to the full Judiciary Committee next week.
 
Notable Bill Introductions

H.5071 - DOT Modernization - The House’s version of the SCDOT Modernization bill that seeks to streamline the delivery of infrastructure projects across South Carolina by shifting certain federal environmental review duties to the DOT, modernizing its procurement process, giving more authority to the DOT and its Secretary, and establishing a Coordinating Council for Transportation & Mobility, among other provisions. The bill would also increase transportation funding by allowing tolling and increasing the EV fee. This bill does not contain language for congestion fees or concurrency.
 
Looking Ahead
*This week’s schedule is subject to change based on this weekend’s weather forecast*

The Senate will continue to debate the DUI bill on the floor on Tuesday. We expect the income tax reform package to be the next piece of legislation debated by the body.

The House is expected to take up two GOP priority issues next week - regulation of hemp products (H.4758 and H.4759) and the ban of mail-ordered abortion inducing drugs (H.4760). The House Ways & Means Committee will continue to hold budget subcommittee hearings as they prepare for mid-February’s full committee meeting. The full House Ways & Means Committee will meet Tuesday morning  to take up the Small Business Personal Property Tax bill and the Maximum unemployment benefits bill. The full House Judiciary committee will meet Tuesday afternoon on the judicial selection bills.