Legislators went along with her other proposals to end payments to state agency lobbyists and scuttle a new aviation and research program at the University of South Carolina.
The House gave key approval to the $5.2 billion spending plan with a 77-42 vote Tuesday. A final vote expected today would send the budget for the fiscal year that begins July 1 to the Senate.
Haley had asked the House to cut roughly $25 million: $1 million for the 2012 presidential primary; $16 million from state worker health care spending; nearly $2 million from the state Arts Commission; $5 million from a University of South Carolina aviation and research program and $1 million from pay to lobbyists who work for state agencies.
The governor has been working with legislators for weeks in private meetings, and her spokesman, Rob Godfrey said there was some disappointment.
"While there are parts of the budget that she is disappointed to see included, it would be premature to start talking about any possible vetoes before the Senate takes up the budget," he said.
South Carolina's first-in-the-South presidential primary looms as a key contest in picking the 2012 GOP nominee. In a letter to legislators Monday, the Republican governor argued public funds aren't needed.
"Political parties have sufficient fundraising ability to offset the costs of partisan presidential preference primaries, and in a budget year like this one, it is my ask that we do not dedicate taxpayer dollars to something I believe does not rise to the level of a core function of government," she wrote.
Rep. Nathan Ballentine, an Irmo Republican, said the presidential primary is important, but legislators haven't set aside enough money to cover 2012 Statehouse primaries.
"I would rate us higher than the presidential primary," he said.
Rep. Tracy Edge, R-Myrtle Beach, said the state has been embarrassed before by presidential primary problems.
"I would think the taxpayers would rather spend a couple million bucks here than not be embarrassed on the national stage," Edge said.
Ballentine's amendment failed with a 46-69 vote.
State Republican Party Chairwoman Karen Floyd said legislators should set aside money to ensure the first-in-the-South contest will pass legal muster.
Floyd said the GOP will try to raise private cash to try to cover primary costs and use the state money as a backup.
At the end of December, the South Carolina Republican Party had less than $5,000 in cash on hand. The party would have to raise more than $90,000 a month to generate $1 million for a January primary.
Haley also wanted state workers to pick up a greater share of rising health insurance premiums. Greenville Republican Rep. Eric Bedingfield said the state has to collect about $28 more per worker each payday. His measure would have required workers to pay nearly $14 of that instead of the planned $8 increase. The proposal failed with a 97-21 vote.
Haley allies offered two amendments to cut staff and funding for the Arts Commission. Legislators are consolidating the commission into the Department of Parks, Recreation and Tourism. Haley told legislators the arts agency, which seeks grants and helps public schools with art curriculum, shouldn't get taxpayer funds. Instead, she said, the commission needed to find private money. Both measures failed.
However, Haley did win the lobbyist spending cut, which passed with a 61-54 vote. Legislators also scrapped the $5 million aviation program. That money instead will be used for law enforcement agencies.