The Post and Courier reported state Sen. Stephen Goldfinch's new bill would pay hunters $75 for each coyote they kill.
The state would pay for it by making hunting licenses cost $1 more.
Officials said coyotes are a nuisance in many cities, and there are an estimated 350,000 in South Carolina.
A controversial coyote hunt in Stanly County is also underway this weekend.
Organizers said the annual Carolina Coyote Classic helps protect the deer population.
Animal rights activists said this does not work and the hunt harms coyote packs.
Stanly County's hunt is expected to last through Sunday.
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