Colorado Senate Gives Initial Approval To Psychedelics Regulation Bill

The Colorado Senate has given initial approval to a bill to create a regulatory framework for legal psychedelics under a voter-approved initiative.

The legislation from Senate President Steve Fenberg (D) passed with amendments in a voice vote on second reading on Monday. A final vote is expected on Tuesday, after which point it would move to the House of Representatives.

“This is a unique proposition that was approved by the voters. We are now in the place where we are implementing this,” Fenberg said on the floor. “Whether you supported it or not, it’s on us to make sure it’s successful.”

Prior to reaching the floor, the measure advanced through the Senate Finance Committee and the Appropriations Committee.

Overall, the bill seeks to set up regulations for a psychedelics legalization law that voters passed at the ballot last year, largely focusing on rules for using the substances in licensed healing centers under the guidance of facilitators. The proposal has received mixed feedback from advocates and stakeholders so far.

The ballot measure called for the creation of an advisory board to develop regulatory recommendations to inform more holistic legislation covering such access, but as that process continues, the Senate president filed a separate bill last week to establish rules.

The legislation seeks to set policies on “healing centers” where adults 21 and older could receive psychedelic treatment, tighten up rules on cultivation and facilitators, establish licensing requirements, dictate state agency regulatory responsibilities and impose penalties for unsanctioned activities.

During Monday’s floor session, senators adopted three amendments from the sponsor.

The first would allow people to have financial interest in up to five psychedelics businesses rather than three, clarify that people can be paid for harm reduction or support services related to the use of psychedelics as long as there is no advertising involved and specify that the juvenile court has jurisdiction in cases where children over 10 are accused of violating drug laws related to psychedelics.

Another adopted amendment would clarify that transferring psychedelics to a minor, or growing more than the allowed amount, is a crime only is someone “knowingly” does it and remove language saying that legal activity under the bill cannot solely be used as a factor by police in determining reasonable suspicion while maintaining language that it can’t be used a probable cause. The amendment also specifies that the bill applies to offenses committed on or after July 1, 2023.

Finally, members approved another proposed change to provide legal protections for people engaged in testing psychedelics.

The Senate rejected two amendments from another senator that would have allowed local jurisdictions to ban psychedelics businesses and the personal cultivation of psychedelics.

“There are going to be additional things that we’re going to have to do to make sure we get it right. But a lot of people are watching,” Fenberg said on the floor on Monday. “This is something that most states have not ventured to do. It’s important that we get it right.”

“As much as we maybe joke about the topic here, it is a very serious issue,” he said. “A lot of people have found incredible value in using these medicines to help them with mental health disorders and other issues, and I’m excited that Colorado is on the forefront of making sure that we provide a safe and responsible manner for people to access these medicines in a more regulated manner. And I think there is a lot of value on the decriminalization side of the substances as well.”

Here are some of the key components of the amended bill: 

The bill would maintain the voter-approved ballot measure’s policy of placing no limits on personal possession of psilocybin, ibogaine, mescaline (not derived from peyote), DMT and psilocyn by adults 21 and older.

Public consumption of psychedelics and underage use would be punishable by a $100 fine.

Adults could only cultivate natural psychedelics, and that activity would need to be at a private residence in an enclosed space that could not exceed 12 by 12 feet—unless within a locality that enacted a policy allowing larger grows. Cultivating beyond prescribed limits wold be punishable by a $1,000 fine.

There would be a pathway for record sealing for people with prior convictions for psychedelic-related activities that have been made legal.

A new Division of Natural Medicine under the Department of Revenue (DOR) would play a central role in regulating the therapeutic program and issuing licenses for cultivators, manufacturers, testing facilities and healing centers. That’s one difference from the initiative, which gave primary responsibilities to the Department of Regulatory Agencies (DORA).

A Federally recognized American tribes and Indigenous community working group—which was not contemplated in the ballot initiative—would be created within DORA to identify and address unintended consequences of the reform, particularly as it concerns the possible commercialization of psychedelics and religious or spiritual exploitation of native people.

The legislation clarifies that synthetic psychedelics are not permitted. And possessing psychedelics with “hazardous materials” like solvents would be considered a Class 2 felony.

Initially only psilocybin and psilocyn could be administered at healing centers, but regulators could add additional psychedelics. The bill differs from the ballot measure by making it so regulators would be able to authorize the supervised use of ibogaine at the facilities at any time, rather than waiting until at least June 1, 2026, as is the case for mescaline and DMT.

There would be four categories of licenses: healing centers, cultivation facilities, product manufacturers and and testing facilities.

The bill maintain’s the ballot measures provisions to block localities from banning healing centers, but says they may enact rules governing time, place and manner of operations.

The deadline for regulators to start accepting and reviewing license applications would be pushed back from September 30, 2024 to December 31, 2024.

Licensed psychedelic businesses will be able to deduct expenses from their state taxes, in a partial workaround to the federal 280E provision.

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The bill’s findings section notes that “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.”

“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,” it says.

Lawmakers face a tight deadline to get the measure passed through the legislature before the session ends on May 6.

The bill has received mixed early reactions, with some advocates tentatively supporting the basic framework and others strongly opposing the proposal because of what they consider to be excessive regulations.

The Senate president said during a committee hearing last week that he ultimately feels that “we’ve struck the right balance,” with the implementation legislation.

“I think we are implementing the spirit of 122,” he said. “I think we’re doing it in a way that provides some consumer protection that is reasonable and doing in a way that provides clarity for folks—for regular citizens but also for law enforcement and the regulators as they go down this path.”

Meanwhile in Colorado, the governor announced on Monday that the state is launching a loan program to support social equity marijuana businesses.

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Photo elements courtesy of carlosemmaskype and Apollo.