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Colorado Passed Psychedelics Regulation Bill

Written by Sarah Friedman

Colorado’s congress just passed a psychedelics regulation bill in line with voted-in Proposition 122. Now it awaits the governor’s signature

Colorado is getting it done, and getting it done fast. A bill just passed through both sides of the Colorado Congress, with regulation measures in accordance with the voted-in psychedelics legalization last fall. Now awaiting sign-off by the governor, this bill is the first one to get the new industry rolling. Read on for details.

Bill passage

It often takes a bill a lot of time to pass congress, whether in a state legislature, or federal. In the case of Colorado’s SB23-290, this bill is moving at record speed. As the legislative session ends on May 6th, the goal was to get it passed before that deadline.

Entitled the Natural Medicine Regulation And Legalization bill, it passed both sides of Congress last month. Since the House made amendments, these amendments had to be approved by the Senate. It approved them on Tuesday May 2nd, in a vote of 32-3. Then the Senate went on to vote a final time on the final write-up, and approved it 24-11. The only thing left is for Governor Jared Polis to sign it into law.

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The bill was only introduced a few weeks ago (April 18th), by Senate President Steve Fenberg. Meaning it went through all of Congress in far less than one month. When the voter ballot passed last year to legalize use of psychedelics, it included a measure to create an advisory board to give recommendations for regulatory laws. Though this might still happen, this bill was offered with no such advisory board in existence.

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The bill filed by Fenberg contains some provisions that are different from the voted-in measure. The advisory board was meant to help create legislation with a greater lean toward holistic healing. As of right now, anything established, was established without that input.

What to expect for Colorado psychedelics regulation

There’s not much reason to expect the governor won’t sign off (though its not impossible). Assuming he follows through on his end, and the bill stands, we now have information on how Colorado will govern its psychedelics industry, and with what kind of regulation attached. Here are some of the key points, some of which do wander from the original ideas of the vote:

Personal Use and cultivation

  • No limits for personal possession of psilocybin, psilocyn, non-peyote mescaline, ibogaine, and DMT. This is in concert with the original voted-in measure.
  • A $100 fine for public consumption offenses.
  • The natural psychedelics listed above are allowable for personal cultivation; so long as its done in an enclosed area of a private residence. A limit of 12X12 feet must be adhered to.
  • A $1,000 fine for cultivating beyond allowable limits.
  • Those with prior psychedelics convictions can go through a process to have their records sealed, but this is not automatic.
  • All regulation applies only to the naturally-occurring psychedelics listed above (and ibogaine). Possession of synthetic versions is not legalized, and synthetic psychedelics with “hazardous materials” like solvents, will be defined as a Class 2 felony.

Natural Medicine facilities

  • Healing centers will be able to administer psilocybin and psilocyn. Regulators can also offer ibogaine under supervised use. This is in contrast to the ballot measure which would have required treatment with ibogaine, DMT and mescaline wait until at least 2026.
  • Healing centers cannot be blocked in individual locations; however, individual locations can set their own operational rules. This stays in line with the ballot measure, and goes in contrast to Oregon.
Meanwhile in Indiana…

Licensing and regulatory agencies

  • The Department of Revenue is to create a Division of Natural Medicine, which will issue licenses and oversee regulation for the industry. This is in contrast to the ballot measure which spoke of the Department of Regulatory Agencies having primary control.
  • Licensing will be required for all four parts of the process: cultivation, manufacture, testing, and delivery through healing centers.
  • A provision not mentioned in the ballot measure was also added which will create a community working group for Native American tribes and the indigenous community. This group will help deal with issues that come as consequences of these reforms; mainly the possible exploitation of these communities through commercialization of the compounds.
  • The bill allows approved psychedelic enterprises to deduct their expenses from state tax payments.
  • The process of reviewing applications can start no later than December 31st, 2024, which was moved back from September 30th, 2024.
Colorado psychedelics regulation bill explains licensing
Colorado psychedelics regulation bill explains licensing

Concerns and workarounds

Some concerns are standard, or at least, standard talking points. While medications like opioids kill tens of thousands yearly and are prescribed easily by doctors; there are fears attached to possible damage caused by this legalization. Even without psychedelics providing any real death or permanent injury count, the bill stipulates:

“although there may be tremendous potential in utilizing natural medicine for managing various mental health conditions, healing, and spiritual growth, this potential must be appropriately balanced with the health and safety risks that it could pose to consumers as well as the cultural harms it could pose to indigenous and traditional communities that have connections to natural medicine.”

In terms of cultural harms, the bill sets up the aforementioned advisory committee. According to the bill, this is because “Considerable harm may occur to indigenous people, communities, cultures, and religions if natural medicine is overly commodified, commercialized, and exploited in a manner that results in the erasure of important cultural and religious context.”

Where the original bill fell short in lawmaker’s minds, the House added a bunch of amendments to try to account for different issues. These include provisions for record sealing (mentioned above); that psychedelic use won’t violate either probation or parole; that cultivation is allowed in a place other than the cultivator’s own residence, so long as its for personal use, in a private residence, and in an enclosed space; that officials should keep track of drug use trends; and that regulators must both make clear what a federally recognized tribe is, and institute an equity plan.

The last point is common in cannabis legalization measures, but has not shown to be a useful tool. Unfortunately, while its good for government optics, such equity programs undermine the cost of operations. In expensive systems of regulation, where operating costs and taxes are high, the groups which would benefit most by such equity plans, tend to be the ones without the means to use them at all. Perhaps this instance will provide a different outcome.

Equity as part of psychedelics regulation bill in Colorado
Equity as part of psychedelics regulation bill in Colorado

How Colorado got here

How did we end up talking about how Colorado will institute regulation for a psychedelics market? It’s not like every state is doing it. In fact, Colorado is the second state to pass a measure to legalize some amount of psychedelic use. The first was Oregon, which passed measure 109 via voter ballot during the November, 2020 elections.

Two years later, and Colorado did the same thing. It put Proposition 122 in front of the public, called the Decriminalization, Regulated Distribution, and Therapy Program for Certain Hallucinogenic Plants and Fungi Initiative. 53.64% of the population voted yes to the measure, which totaled 1,296,992 votes. 46.36% were not up for this change, which accounted for 1,121,124 votes.

Though the bill defined certain plants as natural medicines from the get-go, it came with few specifics, much like Oregon’s original voted-in bill. However, from the beginning, Colorado’s vision was a bit different from Oregon’s; and the state incorporated different ideas from Oregon on certain points. Like in not letting individual locations opt out of the legislation, allowing for more than just psilocybin, and allowing use outside of healing centers.

Is this why psychedelics are so popular lately?

Colorado had a big year for drug legalizations in 2022, and separately went a step further. At virtually the same break-neck speed, the state introduced and passed a bill to preemptively legalize medical MDMA. This legalization is specifically contingent on the US federal government legalizing MDMA for medical use first. So though the bill passed, it won’t be useful until a federal law passes. Even so, Colorado marks the first state to make such a legalization for MDMA.


With not much standing in the way, and a desire to meet a deadline; it seems unlikely that Governor Polis won’t sign the new Colorado psychedelics regulation bill into law. Within a few days we should know the answer for sure.

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About the author

Sarah Friedman

I look stuff up and and write stuff down, in order to make sense of the world around. And I travel a lot too.