One sentence in the 2000 state budget let the Governor’s School for Science and Mathematics keep the money it had not spent. Unspent money normally goes back to the state’s main account, and the legislature decides where it goes next. This sentence let the school keep it instead, and it has never said why.1 The same sentence is in the budget that took effect July 1, 2026. Only 15 of the 170 people who vote on that budget were in the General Assembly in 2000.2

The budget that took effect July 1 has 280 sentences like it, and the money kept under them came to $3.12 billion.3

In football the home team plays every week on its own field, and the visitors come to town for an afternoon and go home. That is the arrangement between the permanent state agencies that hold the state’s money and the legislature that votes on it.

The legislature comes to Columbia the second Tuesday in January, and the law sends it home by the second Thursday in May.4 This year that was January 13 to May 14, plus a handful of days after to finish the budget, the last of them August 11. Base pay for the job is $10,400 a year.5 And the roster turns over. Of the 170 members serving today, 126 arrived after 2010.6

The agencies are there all year. They keep the accounts, and every August they report to the Comptroller General, agency by agency, exactly how much they did not spend and kept.7 Nobody knows those balances better than the people running the agencies holding them, because they are the ones who wrote the numbers down.

Who those agencies answer to is a longer list than most people think. State law names 23 departments in the executive branch, and even those have four different kinds of boss, from a director the Governor appoints to an officer the voters elected to another job, like the Superintendent of Education.8 The universities, the ports, Santee Cooper, and dozens of other agencies are not on that list. Each answers to its own board, and no voter has ever elected one of those boards.9

For a lot of the agencies, keeping the money is the right call. A careful agency in the middle of a multi-year project should not have to hand the money back on June 30 and hope it comes back in July. A careful household does the same thing when it sets aside the roof money in March for a job that starts in September. Some of the $3.12 billion is exactly that, and the agencies holding it are doing what a prudent family does.

So how much of the $3.12 billion is “roof money”?

From the documents the state publishes, there is no way to know. So the home field advantage is worth somewhere between $0 and $3.12 billion. If every dollar is “roof money,” the advantage is worth nothing, and the money is sitting where it should. If none of it is, the advantage is worth $3.12 billion. The budget cannot tell you where in that range the truth falls, because the 280 sentences that keep the money do not say why it needs to stay. The Comptroller General’s August report that adds it up to the dollar does not say either.10 A taxpayer reading both documents at her kitchen table would know how much stayed and in which agency’s name, and nothing else. Same for a legislator.

A sentence goes into the budget, in a year when most of today’s members were not there, with no reason attached. The next year it is printed again. The legislature sees it for four months, inside a budget of almost six hundred pages, and votes yes or no on the whole book once.11 The agency holding the money lives with it all year and knows to the dollar what it holds. Nobody on either side did anything wrong. The reason was never written down, so nobody can go back later, follow the money, and check whether it held up.

The incentive runs one way. More money on hand is better than less, for an agency the same as for anyone, and once a sentence lets an agency keep the money, nothing in the budget ever asks the agency about it again.

You counted that money to the dollar when it was yours. It came out of your check before you saw it, and the least owed back was to know where it went and what it was for. The state can tell you that $3.12 billion of it stayed with the agencies. It cannot or does not tell you whether that was thrift or neglect, because the reason an agency should keep the money is not in the budget.

Asking what the kept money is for is the General Assembly’s job. The money is theirs to leave with the agencies or call back, and a sentence that said why, or a page that showed what each balance is for, would let the visiting team play on level ground. Until that happens, expect the home team to keep its advantage. That is a question the next budget can put on the table, and it is the kind that gets answered once somebody asks it.

The Governor can put the same question to the agencies that answer to him, and the boards and elected officers who run the rest can put it to theirs. How the next governor holds his to account could go a long way toward deciding whether the field gets level.

The Comptroller General is there all year too. When I hold that office, the page that shows what each balance is for will come out every year, agency by agency, so the visiting team walks in with the same numbers the home team has.

Chart Footnote12

Next week: One Page to Justify Billions.

Last week:

On page 469 of the state budget that took effect July 1, the Office of Resilience gets permission to keep money it didn’t spend. The permission is one sentence long and gives no reason. The office “shall be authorized to carry forward unexpended funds from the prior fiscal year into the current fiscal year.“ Farther down the page, one sentence about one of the office’s projects says the money “shall expire at the end of the fiscal year and may not be carried forward.“ No reason there either.

The second sentence is the only one of its kind in the budget. We counted.1

Money the legislature gives an agency for a year is that year’s money. When June 30 passes, whatever an agency has not spent goes back to the General Fund, the state’s main account, for the legislature to decide on again. That has been the rule for decades.2 The exception is a sentence. If the budget has a sentence saying this agency can keep this money past June 30, the agency keeps it. Those sentences are provisos.

Last year’s budget carried 269 of them. This year’s carries 280.3 4The money kept under them came to $3.12 billion.5 In one year the legislature wrote thirteen new permissions to keep money and took two away.

It goes like that every year. Count the sentences the same way in every budget back to 2000 and the number climbs every time: 109, 160, 188, 212, 233, and 297 today.6

The Department of Corrections “may carry forward any unexpended general fund balance“ for security and operating expenses. The parks agency may keep what it didn’t spend on regional promotions.7 Each is a reasonable sentence on its own, written for one agency and one purpose, and neither says why. Each will be printed again next year unless somebody takes it out, and nobody will write down why then either.

This year the state did the one thing you’d expect to take some out. It merged three agencies, the Department of Mental Health, the Department of Disabilities and Special Needs, and the Department of Alcohol and Other Drug Abuse Services, into one Department of Behavioral Health and Developmental Disabilities. The three old agencies had ten of these sentences between them. The new one has ten. Three of the ten are the same sentence. Each old agency had a proviso letting it keep lease-payment money, and all three came through identical except for which office is named. The legislature merged the agencies and didn’t merge a sentence.8

So who keeps track of 280 sentences? Not the numbering. This year 88 provisos in the education section changed numbers without changing a word, because a deleted proviso left a hole that got closed. A sentence about school money that was 1.30 last year is 1.29 now, and 1.30 is a rule about bus advertising. Nothing on the page says so.9

It works like the notes on your refrigerator. Somebody tapes up a new one now and then: a dentist’s number, no dishwasher after ten. Nobody takes one down. After enough years the door is paper. One of the notes is for a dentist who retired. The state’s refrigerator has 280 notes that say keep this, and one, taped up this year, that says throw this out when the year ends.

The money under those notes started as yours. It came out of your paycheck before you saw it, and while it was yours you knew where every dollar went. The sentence that keeps it with an agency was written once and voted on once, inside a bill of almost six hundred pages. It has been printed again every year since, and every vote since has been on the whole bill, never on the sentence.

Some of the 280 are doing what a careful family does when it sets money aside. Some are holding money nobody has looked at since the year the sentence was written, and nothing in the budget tells you which is which. The legislature wrote every one of them, so it is the only body that can take one back, and this year it proved it can with one sentence that makes money expire. Once all 280 sit on one list next to the one that says no, each with its agency, the balance under it, and the years it has been printed, your representatives can decide which deserve to stay. If I am elected Comptroller General, my office will publish that list every year.

Next week: SC Agencies have Home Field Advantage

Last week:

South Carolina’s state government did not spend $3.17 billion of the money it was cleared to spend last year.

Of that $3.17 billion, $49 million went back to the state.

The rest stayed with the agencies.

In South Carolina, money appropriated for a year is money for that year. An agency that does not spend it by June 30 loses it. That is called lapsing, and it is the default. On July 1 the money goes back to the General Fund on its own, except where some sentence in the budget says it can stay. Then the legislature decides all over again next January what to do with it.1

Last year the default returned 1.5 cents of every unspent dollar. Sentences said the other 98.5 cents could stay with the agencies. That is called carrying it forward.2

The year before, the default returned half a cent. Agencies held $3.44 billion they did not spend and returned $18.9 million.3

The rule that sends the money back to the General Fund is still on the books. Nobody repealed it. What happened instead is that the legislature wrote exceptions to it, one sentence at a time, in the part of the budget called Part 1B.

Those sentences are provisos, and they are short. One proviso, 117.23, lets any agency hold up to ten percent of its original appropriation regardless of purpose. That one is the small door. It accounted for $177 million of what stayed last year.

The rest, $2.9 billion, walked through doors built one at a time. The Comptroller General’s report calls that money “special carry-forwards” and defines it as balances that provisos in Part 1B let particular agencies keep. Each one is a sentence written for a specific agency, fund, or program, and each one was voted on inside a budget that runs almost six hundred pages.4

The Department of Transportation carried forward $558.9 million. Higher education carried $507.1 million, Commerce $468.7 million, the Ports Authority $144.0 million. The Department of Education carried $186.2 million and sent back $1.2 million.5

None of this is hidden. The Comptroller General publishes the report every August and posts it on his website, and any citizen can read the same page I did. But the page gives a sum for each department and nothing underneath it. It says which agencies kept money without saying which provisos let them, what it was for, how long it has been sitting, or whether the programs it paid for are still running.

I have asked legislators whether they have that breakdown. The ones I have asked do not.

So the state can tell you that $3.12 billion stayed with the agencies. It cannot or does not tell you why.

An unspent dollar that returns to the General Fund is there in January, where your legislators can put it toward roads, schools, or tax cuts. A dollar that stays with the agencies does not. It is already spoken for by a sentence somebody wrote years ago, and the argument over it happened before most people knew there was one.

You hand a contractor $1,000 for supplies for a job on your house, and the supplies come to $850. He can bring you the $150, or hold it against the next job. Either can be a fair arrangement, depending on whether you agreed to it and whether he tells you how much of your money he is holding.

That is what a lapse rule is for. It sends the leftovers back to the people who answer to voters, so they have to look at them again. When 1.5 cents comes back, the legislature is not where the decisions are being made anymore.

Which of these provisos should keep running is the legislature’s call. What this office can do is publish the list: which proviso authorized each carried-forward balance, what it was appropriated for, and how many years it has been carried. The state’s report already sorts the money by which kind of sentence let it stay, so part of that list exists somewhere.

If I am elected Comptroller General, my office will publish that list every year, agency by agency and proviso by proviso. If the accounting system does not hold the detail yet, I will work to see that it does.

Some of those balances will turn out to be doing exactly what they should. Some will not. Nobody can tell which until somebody counts.

Next week: The Count. 280 Reasons Agencies Keep $3.12 Billion of Your Tax Dollars, and Not One Explanation

Last week:

This year’s state budget gives the Department of Education $185.1 million for school buses. The number is public and easy to find.1 But that is not all the department has to spend on school buses.

The same budget carries at least eight separate provisos, special instructions that direct how money can be used. Each one lets more money flow into the bus operation, carry forward from year to year, or stay with the buses once it arrives.2 They sit scattered across hundreds of pages, and nothing in the budget puts them together.

One proviso lets unused General Fund money become bus money. When the department docks a school district’s transportation money to cover unauthorized mileage, the two can agree to move it, and it can become bus money. What the department earns selling fuel, used buses, even a whole bus shop, can become bus money. Education Improvement Act money and lottery money can become bus money too.

Money an agency does not spend by June 30 normally goes back into the state’s checkbook to be handed out again. Carryforward is what keeps that from happening, so the money stays where it is and the path stays open into the next year. Eight of them, all running one way.

Picture a garage with the family bus parked inside. The front door is the budget, and you can stand there and watch $185.1 million drive through it. The garage has eight more doors, and every one of them opens inward.

One of those doors shows how far the money can travel. This year’s budget appropriates one dollar for School Bus Purchase from the lottery, then directs to the buses all unclaimed prize money above the state’s $23.5 million estimate. The budget calls that second amount “All remaining.”3 Last year, that one-dollar line produced $14.1 million in bus-purchase money. The final figure cannot be known when the budget is adopted, because it depends on how much prize money nobody comes to collect.

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That is not hidden. It is simply not included in the $185.1 million number, and that is the challenge with the way South Carolina uses provisos and carryforward. The legislature can print an appropriation in one place, create another source of money somewhere else, and allow money to carry forward. Every step of that is lawful, and each provision may make sense by itself. Nothing in the rules requires anyone to gather the pieces, so they stay scattered across the act. Taken together, they build a budget that cannot tell you what a program actually has available to spend.

The buses are a good example because South Carolina owns and maintains its entire fleet, about 5,700 buses.4 For decades no law required replacing them on any schedule, and when that requirement finally passed in 2007, the money came in fits and starts.5 When you cannot count on the money, you take what you can get when you can get it. Funding has improved since, with more than 4,850 buses added over the past decade.6 The extra doors are all still open in that budget, and seven of the eight sit in the one passed this summer.

The Department of Education’s own accountability report spreads bus spending across at least seven lines.7 You have to find them and add them up yourself. Even then you are looking at what was spent, never at one number showing what the system had available to spend.

Nobody is hiding this. Some of the money cannot be known in June, because it depends on what the department does not spend, what lottery players never claim, and what the bus shops earn. The trouble is what happens next. Nobody adds it up afterward either.

The buses are one program in one agency. This year’s budget carries 269 carryforward provisos like these, by our line-by-line count.8 The buses are not the problem. They are the example. If one program can have eight separate paths for money to arrive, stay and roll forward with no page showing the total, ask what happens when that practice runs 269 times.

You can read every page the legislature passed and still not know where the money goes, when it gets there, or how much is left. Money taken out of a paycheck should not require a scavenger hunt to follow.

The state’s books already hold these numbers. I am running for Comptroller General, and when I take office I will put them on one page, program by program, where a taxpayer can find them.

A budget nobody can add up is a budget nobody can manage.

Next Week: Keeping $3.12 Billion in Change

Last week:

The proviso file behind this piece was built by the campaign’s volunteer research team. The work in this series is theirs as much as mine.

It’s called Show Me the Money, and the first episode is live now. Every episode, I’m going to break down where South Carolina’s tax dollars actually go and whether you’re getting what you paid for.

Here’s why I’m starting with this. The Comptroller General’s office has two jobs. The first is accountant. The second is watchdog. Too many people treat it like the office is just there to keep the books and stay quiet. I don’t think that’s good enough and in this first episode I explain why the office has to be more than a passive bookkeeper and how I plan to turn it into an active taxpayer watchdog.

South Carolina publishes thousands of pages of financial reports every year. Almost nobody reads them. I do.

I follow the money, and I explain what I find in plain English, the kind of English you don’t need a law degree or a lobbyist to understand.

That’s the whole point of this show. Open the books. Follow the money. Say it straight.

I’m going to keep opening the books, protecting your tax dollars and working to make South Carolina the best financially run state in America.

Thanks for being with me on this.

Mike Burkhold - The Man Who Counts

www.burkhold.net

Every year South Carolina publishes its financial report, and every year, in the notes, it prints the same sentence: “Unexpended appropriations lapse on July 31 unless the department or agency is given specific authorization to carry them forward to the next fiscal year.” Money an agency did not spend goes back, unless somebody gave it permission to keep it.

Word for word, in every report from 2009 through 2025. We pulled all seventeen and read the page in each.1

In the first of those years the state’s main operating account, the one that sentence governs, ended with $120 million in it. In 2025 it ended with $6.6 billion.2 Same rule, 54 times the money.

The money did not creep up. For most of that run the account behaved the way the rule suggests it should. It held $120 million in 2009 because the recession had drained it, which is what a cushion is for. It rebuilt over the next three years to about a billion dollars, and then it sat. From 2013 through 2018, six straight years, it stayed between $1.0 and $1.2 billion.3

Then two years moved it and nothing has moved it back. In 2019 it climbed to $1.7 billion. In 2021 it doubled. In 2022 it nearly doubled again, to $6.9 billion.4 The money came from a boom in state tax collections. When it landed, what did the system do with it?

It absorbed it. It has kept it every year since.

None of this needs a villain to explain it. An agency keeps money it is not spending for the reason you would give in its place. A cushion means a bad year does not become a crisis, and a lean budget does not become a layoff. An agency head who could build one and didn’t would be failing his own people. And this is not a government trait. I ran a company for seventeen years, and pushing back on departments that wanted more was my job. Once a year somebody sat down with each one and asked what it needed, and that conversation was the only reason money came back. Nobody looked forward to it. In state government that job belongs to the legislature.

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And the state does pull money back sometimes. The same note that carries the lapse rule also lets the budget office cut spending the legislature already approved, if that is what it takes to prevent a deficit.5 A bad enough year spends the cushions, the way 2009 did, and 2024 took more than $800 million off the balance. A vote can do it too: a billion dollars went back to taxpayers in 2023.6 Every one of those took a crisis or a decision. Nothing sends money back on its own.

What the $6.6 billion is for depends on which part you mean. About $1.4 billion of it is set aside in the three reserve funds the state counts, and those are filled by rule and reported in one place. The rest is the $3.4 billion agencies kept under sentences in the budget’s fine print and $1.7 billion assigned to nothing.7 No formula sets either one, and no document says what the right level would be.

None of that money went anywhere. It is all in the one account, and what carries forward is the permission to spend it.8

The same habit runs in your own house in a smaller way. Somewhere on your bank statement is a charge that renews every month for something the family quit using a long time ago. Renewing takes nothing. Stopping it takes a decision, an account, and a phone call. So it renews, and not because anyone wants it. The budget works the same way.

Nobody has any incentive to send money back.

Outside a crisis, only the legislature can send kept money back to the General Fund, the state’s main account, and that has to happen every year, as a habit, because the keeping happens every year, as a habit. But nobody sends back a total that never reaches the budget. The sentences pass one at a time, each easy to defend on its own, and the total never lands on a page. A number nobody adds up is a number nobody can act on.

That money started in your paycheck. It came out before you ever saw it, and while it was yours you knew what every dollar of it was for. It has sat since in an account that grew 54 times over under a sentence that never changed a word. You counted it when it was yours. As Comptroller General, I will count it every year and publish the total.

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Next week: Follow the Bus Money

Last week:

The proviso file behind this piece was built by the campaign’s volunteer research team. The work in this series is theirs as much as mine.

Money an agency has not spent when the budget year ends goes back to the General Fund, the state’s main account, unless the agency has specific permission to keep it.2 Those 269 sentences are the permission. The rule is a good one, because money that goes back has to be asked for again, out loud, in public.

The budget grants some of that permission to everyone, for an honest reason. One sentence, Proviso 117.23, lets every agency keep up to a tenth of its unspent money, because an agency that loses every unspent dollar at the year’s end has one incentive in its final month: spend it all before the clock runs out. That case is fair, and a tenth seems to be a reasonable amount.

Then come the other 268 sentences, each written into the budget the General Assembly passes, each letting a particular agency keep money beyond that tenth. Take two. The alcohol and drug abuse agency may carry forward unexpended funds “in excess of ten percent” of its appropriations, to fund opioid prevention, treatment, and recovery.3 Nobody argues with that purpose. But the sentence never says why that agency should not have to come back, and ask like everyone else. And the state’s film office keeps whatever it does not spend, with that year’s fine print directing up to $2 million of it into a new rebate program for film producers.4

The trouble is not any one sentence. The trouble is the sum. Nobody sees the sum until the money is already kept.

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By the state’s own numbers, the money kept this way stood at $3.426 billion when the 2025 budget year closed. The state’s label for it runs seven words: agency carryover appropriations approved by the legislature. Money agencies kept.5 On August 18 the Comptroller General’s office posted its unaudited count for the year that ended in June: $3.1 billion, the fourth straight year above $3 billion.6

If the state is holding money instead of spending it, isn’t that just saving?

Real saving gets counted. The state has savings accounts, reported in one place: the General Reserve, the rainy day fund, at $740 million, the Capital Reserve at $370 million, the Contingency Reserve at $332 million, about $1.44 billion in all.7 None of the $3.4 billion sits in them. If this were saving, it would be flowing into those accounts. Instead it stays on the agencies’ books, while the cash sits with the State Treasurer, pooled and invested as state law directs.8 The dollars are not lost. And at the June 2025 close, the pile the agencies held was more than twice all three savings accounts put together, with no cap, no formula, and no page of the budget that shows its total.

That last part is how $3.4 billion hides in plain sight. Legislators write the sentences one at a time, each reasonable on its face, agencies keep the money, and no page of the budget adds it up. The natural question is which agencies held the biggest piles. That much the state publishes each August, agency by agency: Commerce topped the 2025 list, at $891 million.9 What no state document has ever published is the map from sentences to dollars, which of the 269 permissions kept which money. We built the sentence half of that map over the spring. Nobody has published the other half.

Kept money does not have to be asked for the way new money does. It does not have to be justified. A dollar that goes back must be requested next year against every other need in the state. A kept dollar needs only its sentence to reappear in the fine print. The sentences do expire. The legislature votes them back each year, in bulk, hundreds at a time. This spring, deadlocked over the new budget, it extended all of them in one housekeeping resolution.10 Every sentence has a constituency that knows its number to the dollar. The total has no constituency.

There is no lobby for adding things up.

A family runs everything through one joint account, and each year it hands out cash for the real needs: the tires, the roof. Whatever a family member does not spend, they keep, in an envelope on the kitchen counter. Nobody is stealing. The tires got bought. But the change never goes back into the account, and no one has ever counted the envelopes on the same day. The family also keeps $1,400 in a savings account at the bank, and that statement gets shown to anyone who asks. Ask this family what it has saved and you will hear the bank number. The envelopes hold $3,400.

The money in those envelopes started as yours. It came out of your paycheck before you ever saw it, and while it was yours you counted it to the dollar, because that is what you do with money you earned. The state’s answer to what became of it is 269 sentences in one document, a total in another, and no page connecting them. Maybe $3.4 billion is the right amount for the agencies to hold. Maybe it is not. That question belongs to the legislature, and to you, and nobody can take it up until somebody lays the whole thing on one page: each sentence, each agency, each dollar kept under it. As Comptroller General, I will publish that page every year. Putting the count in front of the people who can act on it is the job, and that job is the one I’m seeking.

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Next week: The Growth. In 2009 the state’s main account held $120 million. Last year it held $6.6 billion, and the sentence that governs it has not changed a word.

Last week:

The Raise

The proviso file behind this piece was built by the campaign’s volunteer research team. The work in this series is theirs as much as mine.

The first question anyone should ask is whether it had to happen. Some of it did.

About 674,000 more people live here now than lived here in 2015. Every one of them is a new driver on a road, a new patient in a clinic, sometimes a new child in a classroom. Prices went up too, about 35 percent, so the same textbook and the same mile of asphalt cost about a third more than they used to.2 The count has to allow for more people to serve and more expensive everything to serve them with.

The new people and the higher prices together should have grown the budget by about half, to roughly $10.5 billion. That is what keeping up with population growth and inflation would have cost.

The state spent $13.8 billion. The difference is a little over $3 billion. Not once. Every year.3

So spending $3 billion more a year is not required by inflation and population growth. It is a choice. And the question any family would ask is simple. What did we get for spending all this additional money? It might have been good news: new programs, more bridges repaired, more miles of road paved.

The state does not publish what we got for all this extra spending, so we can’t know.

The state’s annual financial report says how much each agency received. It does not say what the agency delivered for the money. Ask what the extra $3 billion a year produced and there is no page to turn to.

You would expect a state spending at that pace to be scraping the bottom of the account by the end of the budget year in June. It is not. Last year the state took in about $227 million more than it spent, near enough to breaking even on a budget that size. But the account the $227 million surplus went into finished the year holding $6.6 billion, built up over years and carried forward one year into the next. Ten years earlier that same account held $1.2 billion.4

The individual income tax, every dollar the state collected last year from every working person in South Carolina, came to $5.9 billion.5

The state is sitting on more money than it takes out of our paychecks in a year.

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It is not thrift. Spending went up in nine of the last ten years. It went up faster than population growth and prices.6 The money came from two years.

In 2021 and 2022, revenue ran ahead of spending by about $5.5 billion combined. That was the pandemic, though not the way most people would guess. The federal relief money went into separate accounts (we will cover at a later date), on different pages of the same report. What landed on the state’s own books was ordinary state tax, because federal stimulus checks got spent at South Carolina stores and taxed on the way through. Sales tax collections rose about 38 percent in three years.7

In February 2022, with the money coming in, the state’s own economists reported that revenue had grown 22.5% in a year. They said the sales tax and corporate tax share of it was temporary. They used the word “bubble.”8 Those two years built the pile of money, and the years since have run roughly even between them. Running even sounds responsible, and a pile of money can look like careful saving. But the state already keeps real savings accounts. The law requires two of them, and both are filled to the line the law requires. A third sits beside them with no formula cap. All three together come to about $1.4 billion, and all three are inside the $6.6 billion. The other $5.2 billion is not savings anyone planned. It came in too fast, got stacked, and has stayed in the system.9

Two years ran the other way. In 2017 the state spent about $63 million more than it collected, and the books closed in the black only because a lawsuit settlement put $139 million in the account. That is money from a courtroom, not from taxes. In 2024 spending ran about $748 million ahead of revenue and the balance fell by more than $800 million, the steepest drop in the whole run.10

When a raise comes, one of two things usually happens in a house. Either it goes into the account and stays there, or the house grows into it, and a year later there is a bigger payment and no clear sense of where the money went. Columbia managed both. Spending grew into the raise, all of it, and the account filled up anyway.

Nobody minds paying their share. You pay it the way you pay the light bill, because the lights have to stay on. What is not settled is whether anyone was ever going to tell you that the money came in faster than the state could spend it, that the state spent more anyway, and that what is left is sitting there. Somebody in Columbia is supposed to be keeping those books and saying so out loud. That is what I’ll do when I’m elected Comptroller General.

The file behind this piece was built by the campaign’s volunteer research team. The work in this series is theirs as much as mine.

Next week: The Pile of Money. Of the $6.6 billion, $3.4 billion is money the budget lets agencies keep past June 30, year after year.

Last week:

Give the state credit for the word, because it is the honest one. Announced means a company stood at an announcement and said what it intends to spend building here and how many people it intends to hire. Some of those intentions come true, some come in smaller, and some never happen at all, which is normal business and nobody’s scandal. Every state’s commerce department keeps score this way, so South Carolina is not unusual. The question is what happens to the number after the announcement, and that question has an official answer.

The state’s auditors gave it in 2020, in plain words: the annual reports and press releases “only include projected figures for job creation and capital investment,” and neither Commerce nor the Coordinating Council that approves the incentives “publish actual job creation and capital investment data.” Part of that got fixed. After the audit, the Council began publishing results for finished deals, and this series has already covered them: grants that closed over the past decade reported 115 percent of the jobs required, numbers certified by the companies themselves. That is a real improvement, and it lives in an annual report almost nobody reads. The January scoreboard, the one number that makes every front page in the state, still counts what was announced.

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The auditors also asked for the harder thing: look back at completed projects and measure whether the incentives actually pay for themselves, the announced billions converted into a return the public can see. When the auditors checked back in 2024, Commerce’s answer was on the record: it “has evaluated this recommendation and has not found a credible way to conduct an effective ‘look back’ analysis for any given project.” Put those two sentences side by side. The same system that can tell you the year’s promises came to $9.12 billion, not nine, not nine and a quarter, says that measuring what came back cannot credibly be done.

The same pattern shows up inside the jobs number. The scoreboard counts more than 8,100 announced jobs; it does not say what the jobs pay. The auditors recommended in 2020 that the state publish the median wage of the new jobs it pays incentives for. When they checked back in 2024, the answer was that Commerce is considering it once its reports move online. Six years of decimal precision on how many jobs were promised, and “considering” on what the jobs pay.

Remember whose money sits under the scoreboard. The state pays for this recruiting two ways. The grants are checks from the state treasury. The credits are income tax withheld from workers’ paychecks that the state lets companies keep, more than $200 million of it in the decade the auditors reviewed. The announcements are the public case for all of it, the reason the programs exist and grow. You know how this works at home. A promised raise is good news, and you still do not spend it until it shows up in the paycheck. The state’s scoreboard counts the raise the day it is promised. It keeps one column, what was promised, to the second decimal, forever. The column for what came back stays empty, and the office that keeps the scoreboard says it has not found a credible way to fill it in.

Next January the precision will return, another billion-dollar figure quoted in every paper in the state, and the same word will be printed in front of it. “Announced”. Now you know what the word means, and you know the question the scoreboard does not answer: what came back.

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Next week: The Raise. South Carolina's operating budget doubled in ten years. More people and higher prices explain about half of it.

Last week:

Sources: S.C. Department of Commerce and Office of the Governor, 2025 industry recruitment results release, January 14, 2026 ($9.12 billion announced capital investment, 82 announced projects, more than 8,100 announced new jobs); prior-year releases January 2023, January 2024, January 2025 (announced qualifier on each year’s headline figure). Legislative Audit Council, Review of Incentive Programs Administered by the S.C. Department of Commerce, June 2020, p. 23 (projected-figures finding). Legislative Audit Council, Follow-Up Review, August 2024, p. 2 (look-back recommendation, not implemented, quoted; median-wage recommendation, not implemented). Coordinating Council for Economic Development, 2025 Annual Report of Fund Activity, p. 25 (115 percent, closed grants, company-certified).

The credit works like this. When a company promises new jobs, the state lets it keep part of the income tax withheld from its workers’ paychecks. The program calls these job development credits, JDCs for short. The money never reaches the treasury, so the credit costs the state the same way a check would. Over the decade the auditors reviewed, 2009 through 2019, 415 companies claimed more than $200 million of it. The claims live in the Revenue Department’s tax records. The sentence hands the auditors the records of every state agency, then takes one set back: “with the exception of reports and returns of the South Carolina Department of Revenue.” The auditors’ 2020 report says what that did to their review: it left them “prevented from knowing if a company has claimed any JDCs at all.”

Sit with that. Since the auditors could not know who claimed the credit, they could not pull one company’s claim and test it against the jobs. Everything they learned about the program’s checking, they learned by interviewing the people who run it.

The interviews were not comforting. Commerce officials called the program risk-free because the Revenue Department is required by law to audit every company with a large claim. Revenue’s own staff said many of those audits were not happening, and that in the audits that did happen, something was wrong in up to 95 percent of the claims. So the checking the auditors were locked out of was the checking that kept finding problems. You would not accept this at your own house. You hire an inspector for the whole place, and the law locks the one room where the checkbook is kept.

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The auditors asked the General Assembly for exactly one thing in 2020: amend the sentence so they can see the Revenue Department’s tax records when an audit requires it. Six years later, the amendment remains unwritten.

State law already seals the auditors' own records. Company payroll is certainly private information, and it should be treated that way, but state auditors handle private information as a matter of routine, from every agency except the Revenue Department, and an auditor who leaks faces criminal penalties. I know this work from the inside: I ran a healthcare company that processed millions of claims carrying patients' private health information, and we kept it private, with systems built for that and access limited to what the job required. Confidential and off-limits are not the same thing. The sentence only decides whether the state's own checkers may look.

And the General Assembly has been in the room. Since 2019, every session has seen a bill to give the auditors subpoena power, the power to make an agency hand over records and answer questions under oath. The latest version of the bill nearly passed this spring: the House voted for it 112 to 0, the Senate 46 to 0, and the two sides parted in May over a procedural detail. But a subpoena only reaches records the law lets the auditors see, and the sentence is the law that keeps the tax records off that list. Every version of the bill copies the sentence forward word for word. Three unanimous roll calls for subpoena power. Not one vote, ever, to let the auditors see the Revenue Department records necessary to validate the credits.

Amending the sentence is not part of the job I am asking for; it belongs to the General Assembly, and it may be the cheapest fix in this whole series. The credit is paid with state income tax taken out of workers’ paychecks before the workers ever see it. Nobody asked them. The least they are owed back is that somebody independent of the program gets to count whether the jobs those dollars bought are real. Today that count is against the law. The problem is one sentence in the code. The repair is one sentence too, and somebody in the General Assembly gets to be the one who writes it.

Added August 4: the paragraph on the case for taxpayer confidentiality, in response to a reader's question.

Next week: Announced

Last week:

Sources: Legislative Audit Council, Review of Incentive Programs Administered by the S.C. Department of Commerce, June 2020: the confidentiality bar and the auditors’ statement pp. 53-54; DOR audit staffing, frequency, and discrepancy rate pp. 51-52; JDC claims and program scope pp. 51-55; Recommendation 21 p. 55. S.C. Code §2-15-61. H.4337, South Carolina General Assembly, 2025-2026 session, legislative record at scstatehouse.gov.

In 2020, the state’s auditors finished their review of South Carolina’s business incentive programs and left behind thirty-nine fixes, addressed to the Department of Commerce, the council that approves the grants, the Department of Revenue, and the General Assembly itself. In August 2024, they went back and counted: seventeen done, six partly done, fourteen not done, two no longer applicable. Four years is enough time to know which items an agency intends to do. The fourteen are the story, because of what they have in common.

First, give the record its due. Take the Department of Revenue’s audit shop. It was down to one auditor for the whole tax-credit program by 2020. It has five now, and says it is completing the audits the law requires. Clawbacks and write-offs, the money taken back and the money given up on, started appearing in the Council’s annual report in 2021, where before that they appeared nowhere. Those are real fixes, and an agency that intended to do nothing would not have done them.

Now look at what was declined. The recommendation to verify companies’ claimed jobs beyond their own paperwork: not implemented, with Commerce answering that the fix “is not practical to implement and would be unduly cumbersome on staff.” The recommendation to check job claims against the wage records the state already holds at the Department of Employment and Workforce, the answer key from last week’s piece: not implemented, and still no data-sharing agreement exists. The recommendation to run fraud risk assessments: not implemented, with Commerce answering that only three known grant frauds have turned up in fourteen years, all three in a county where the agency had been advised to accept more risk. That is a strange comfort. You only know about the frauds you went looking for, and looking is what was just declined. The recommendation to check, after the fact, whether the incentives pay for themselves: not implemented, with Commerce answering it has “not found a credible way” to measure it. And when the auditors pulled ten grant files at random from the newer awards, 2020 through 2024, four of the ten contained no supporting financial documents at all.

Set the two lists side by side and the pattern names itself. Not one fix the agencies adopted tests whether a promised grant job is real. Every fix that would have tested one, the extra verification, the wage-record match, the fraud screens, tax-record access for the auditors themselves, sits on the declined list. What got adopted, nearly all of it, publishes numbers. What got declined would have checked them. The state now publishes better numbers about the program. It still does not check whether the jobs behind them are real.

Here is the household version of the fourteen. A home inspector walks your house and hands you a written list of what is broken. You fix the things that show from the street, the paint, the doorbell, and you leave the crack in the foundation alone. Four years later the inspector comes back, writes down that the crack is still there, and hands you the new list. Nothing else happens. Nothing else can happen, because the inspector’s only power is to inspect again. That is the enforcement system for South Carolina’s audit findings, stated exactly: the penalty for ignoring a state audit is a second audit. And there is one difference between you and the agencies on that list. When you put off your own foundation, the penalty is real: the crack grows, and the bill is yours. Their penalty is the one you just read. The bill still lands on you.

The auditors did their job, twice, and did it well; none of this lands on them. It lands on the arrangement above them, where a finding creates no duty for anyone, so the fixes an agency likes get done and the fixes it finds cumbersome sit in a report on a shelf. Six years of your money have moved through these programs since the first inspection, counted the same way as before: by the companies that received it. You counted that money every payday, to the dollar, while it was yours. It left your check before you ever saw it, and nobody asked. What the state owes you back is small: findings that somebody must answer, and somebody whose job is to keep counting after the inspectors go home.

Next week: One Sentence in the Code

Last week:

Sources: Legislative Audit Council, Follow-Up Review of the S.C. Department of Commerce Incentive Programs, August 2024: status table and counts p. 1; job verification (Rec. 16) and look-back analysis (Rec. 10) p. 2; DEW/DOR data sharing (Rec. 17), DOR audit staffing (Rec. 20), and clawback and write-off reporting (Recs. 18-19) pp. 2-3; fraud risk assessments (Rec. 37) and grant file sample (Rec. 35) p. 4. Coordinating Council for Economic Development, 2025 Annual Report of Fund Activity, March 2026: clawback and write-off disclosure pp. 26-27.

And that is not a portrait of the old days. The Coordinating Council’s own annual report, published this March, describes the process the same way today: when a company’s deadline arrives, the company certifies its own jobs and investment and sends in documentation to support its performance. Six years after the audit, the evidence still starts at the company.

Last week’s piece counted the $5.2 million the state billed for and gave up on. This week is the other half of that story: why the money went out so easily in the first place. It went out on numbers the companies wrote down themselves. The audit’s case files show where that leads: one CEO got a $1.2 million grant with a faked financial report. He was sentenced to fifteen years for fraud; the courts did their job. The paperwork did not.

Here is the part to sit with. South Carolina already owns the answer key. Every employer in the state files quarterly wage reports with the Department of Employment and Workforce, listing every worker’s name, Social Security number, wages, and hours. Checking a company’s job claims against those reports is a matter of one state agency sharing a file with another. A Commerce staff member told the auditors the Coordinating Council used to receive those reports, and stopped in the mid-1990s. Reagan’s old rule was trust but verify. For thirty years, the state has done the trusting and skipped the verifying.

Now, some things do get checked. Capital investment gets verified against a company’s property tax return, or against invoices and proofs of payment, which are harder to fake than a spreadsheet. Site visits exist for projects that renovate buildings, to confirm grant money was spent as the company represented. And on the tax-credit side, where companies keep a slice of their employees’ withholding taxes, Commerce told the auditors the program carries no risk, because the Department of Revenue is required by law to audit every company claiming more than $10,000 at least once every three years.

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Then the auditors counted the times anyone checked. The site visits stopped in September 2018 and did not resume until the auditors showed up in August 2019; twenty-one of the fifty-three visits ever made happened after the audit began. At the Department of Revenue, two auditors covered the whole tax-credit program, completing 15 to 29 audits a year while 138 to 184 companies claimed the credit, so the every-three-years rule was going unmet, and some companies had never been audited at all. And the audits that did happen produced the most important number in this piece: DOR staff told the auditors that discrepancies turn up in as many as 95 percent of them. Companies claiming past the per-employee cap. Companies claiming credits for workers no longer there. In the one corner of the program where somebody looked, almost every file had something wrong in it.

A Commerce official gave the auditors the honest name for the tax-credit side, and it is on page 54 of the report: the state relies on the “honor system” for the jobs and investment a company claims on its quarterly reports. Their word, in the record.

Which brings us back to the good news from last week, the Council’s own scorecard showing companies delivered 115 percent of the jobs they promised. Where does a number like that come from? From the end of the process described above: the company certifies, the company supplies the backup, and the staff reviews what the company sent. The auditors also asked how job numbers get entered into Commerce’s database and from what source documents, and the answer was that no written procedures existed. So the scorecard is true in exactly one sense: it is truly what the companies certified. Every teacher who ever let a class grade its own quiz knows what those scores come back looking like.

None of this says the jobs are fake. Most of them are probably real, and that is what makes the arrangement unfair to everyone, including every honest company whose real jobs are now vouched for by the same system that vouched for a faked financial report. The reason nobody checks is the usual one. Checking is work, and the money at stake belongs to nobody in the room. You checked your own bank statement against your checkbook every month of your working life, because the money was yours. The state lent yours out and took the borrower’s word for what came back, and it has taken that word, on the record, since the mid-1990s.

Next week: The Second Inspection

Last week:

Sources: Legislative Audit Council, Review of Incentive Programs Administered by the S.C. Department of Commerce, June 2020: verification of job claims and DEW wage reports pp. 41-42; job data entry procedures p. 18; capital investment and site-visit verification p. 42; fraud case file p. 49; site visits p. 42; DOR audit staffing and frequency pp. 51-52; discrepancy rate p. 52; “honor system” p. 54. Coordinating Council for Economic Development, 2025 Annual Report of Fund Activity, March 2026: certification and closeout process pp. 22-24; performance history (115%) p. 25.

When a company takes a grant from South Carolina and does not deliver the jobs it promised, the contract already says what happens next. There is a formula, written into the deal, for how much of the money the state takes back. Over the ten years auditors examined, that formula meant the state could have demanded about $17 million from companies that fell short. The state asked for $9.3 million, collected $7.8 million, and wrote off $5.2 million as money it will never see.

Those numbers come from one document: the Legislative Audit Council’s June 2020 review of the incentive programs run through the Department of Commerce. The state pays companies to move here or expand, in exchange for a promise: this many jobs, this much investment, by this date. A body called the Coordinating Council for Economic Development approves the grants, and when a company falls short, the Council collects. And the Council is supposed to be working for you. You are the one who put up the money.

The Council’s own newest report has good news for the program, and that goes first. By the Council’s count, the 289 grants finished over the last decade created 115 percent of the jobs they promised and 139 percent of the promised investment. On paper, most companies over-deliver. The program is not a failure, and this piece is not about the companies that kept their word. It is about the smaller pile, because the smaller pile is where you find out what happens when a promise to you gets broken.

Start with why the state asked for $9.3 million when its own formula supported $17 million. The contract has a second clause. A company that falls short can hand in paperwork showing it made a good-faith effort, and if the county that received the grant and the Council decide, in the contract’s words, “in their sole discretion,” that the circumstances excuse the shortfall, the agreement gets rewritten to match what happened. The state’s auditors read that clause and said plainly what it amounts to: flexibility to reduce or waive any repayment that would otherwise be required. Their words, page 46. About $7.7 million of the gap between could-have and did is that clause at work.

What counts as an excuse? The auditors asked that too, and a Commerce staff member gave examples: job requirements are hard to fill in rural counties, South Carolina’s low unemployment makes it hard for some companies to find workers, construction runs late, and downturns change business plans. Some of those are real hardships; a rural county’s labor pool is what it is. But look at the whole list together. Between a thin rural labor pool and a booming state’s empty one, it covers every county in every year, and delays and downturns cover every project in every economy. An excuse list that broad means the company is never really on the hook. The risk lands back on the person the formula was supposed to protect, and that person is you. And the second excuse deserves one more beat: the program exists because the state wants more jobs, and the excuse it accepts for missing jobs is that there was nobody left to hire.

Now ask who holds the discretion. The Council has thirteen seats, with the Secretary of Commerce in the chair. Ten belong to agency heads and appointed board chairmen. One statewide elected official has a seat, the Commissioner of Agriculture. And in 2021, the budget year after this audit landed, the legislature added the chairmen of its two budget committees, putting its own eyes in the room. None of that is a knock on anyone at that table. It is just how the table is built: when a debt owed to you gets forgiven, this is the room that decides, ten of its thirteen members answer to no voter, and the only people who check the forgiving are the people doing it.

Then there is the $5.2 million the state billed for and gave up on. In the years the auditors examined, when a company quit paying or quit answering, nothing followed, because nothing had to. Since then the Council has added a tool: dead debts now go to the state’s tax-collection program, called GEAR. Its whole history: 26 companies sent there, $887,426 brought back. In one file closed last year, GEAR recovered exactly $53, and the Council wrote off the remaining $168,697. And the clause is still in use: in 2025 the Council waived or wrote off four repayments totaling $352,475. Credit where it is due, and it is due: every number in this paragraph is public because the Council itself publishes it.

Now say it in household terms. Suppose you handed your savings to a man to lend out for you, under signed agreements that spell out exactly what each borrower owes back if he breaks his promise. Then you learn the fine print lets that man forgive any debt he wants, on his own say-so. And when a borrower stops paying, the man you hired hardly ever collects a dime. You would fire that man by Friday. Not because he is dishonest, but because you would never know if he were.

The auditors did not find a villain running the program, and the story does not need one. They found a repayment formula that was a suggestion, an excuse list that covers every county in every year, and a discretion nobody above the room reviews. How the money went out in the first place is a story of its own, and it is next week’s. You counted every dollar of that money while it was yours, because it was yours. Once it crossed into the state’s hands, whether it came back at all was left to somebody’s sole discretion, and $5.2 million owed to the people of South Carolina was money nobody ever had to collect.

Next week: The Honor System

Last week: The Hat Switch

Sources: Legislative Audit Council, Review of Incentive Programs Administered by the S.C. Department of Commerce, June 2020: repayment formula, waiver clause, and staff examples of waiver circumstances pp. 46-47; Chart 3.3 (clawbacks and write-offs) p. 47. Coordinating Council for Economic Development, 2025 Annual Report of Fund Activity, March 2026: membership pp. 4-6; performance history (115%/139%) p. 25; GEAR collections pp. 24, 27 and Exhibit F; 2025 waivers and write-offs p. 27 and Exhibit F.