MDHHS presents FY26 budget proposals: vaping tax estimated $57M, $20M to maintain crime victim services; lawmakers press on federal funding risk

Michigan Department of Health and Human Services officials briefed the House Appropriations Subcommittee on Public Health on the department’s fiscal year 2026 executive recommendation, highlighting three specific investments and pressing lawmakers on the department’s reliance on federal funding.

“A vaping tax that is estimated to generate $57,000,000 annually … those funds would partially support smoking prevention, cancer prevention, and youth mental health,” Amy Eppke, senior deputy director of financial operations at MDHHS, told the subcommittee. Eppke said the FY26 executive recommendation includes that vaping tax alongside two other investments: $20,000,000 in state funding to maintain existing crime victim services and funding to implement a paramedic competency exam required by Public Act 48 of 2024.

Eppke said the additional $20 million is intended “to continue the services that are being provided to 147 crime victims across the state,” and that the request responds to declining federal funds for the program. Committee members pressed staff for more detail about who provides those services and how redundancy is avoided. Representative Steele asked for a list of the roughly 120 organizations the department contracts with or funds to provide crime-victim services; MDHHS agreed to provide the list and supporting performance information at a future hearing.

Lawmakers repeatedly raised the department’s dependence on federal funding. MDHHS staff said about 70% of the department budget is federal money and identified a key Centers for Disease Control and Prevention grant — the Epidemiology and Laboratory Capacity (ELC) grant — as supporting dozens of positions that underpin communicable-disease response. MDHHS staff said the ELC grant supports 64 positions; officials warned that losing that grant would reduce rapid-response capacity and local health department support.

Committee members asked whether state funding in the executive recommendation replaces federal funds already backfilled by the state in prior years. Eppke said the existing budget already included $30,000,000 in general fund support to backfill federal reductions and that the FY26 request adds $20,000,000 to offset further declines.

Other questions during the hearing ranged from how the agency decides to operate a state-run lab versus contracting with private laboratories to advertising spend and whether vaping prevention materials address marijuana use. MDHHS committed to follow up with detailed lists and numbers lawmakers requested, including the list of victim-service organizations and the department’s advertising expenditures.

Votes at a glance: Representative Price moved to approve the minutes of the March 11, 2025 meeting; there being no objections, the minutes were approved by unanimous consent.

Ending: The subcommittee did not vote on the executive recommendation itself during this meeting; members requested follow-up briefings and documentation before any appropriation decisions.