What You Need to Know About SB23-290, Colorado’s Natural Medicine Health Act Implementation Bill

In November 2022, Colorado voters passed the Natural Medicine Health Act (NMHA), a groundbreaking law to establish access to natural psychedelic medicines for adults 21 years and older. The objective of the NMHA was to provide safe and equitable access to natural psychedelic medicine to all adult Coloradoans who may need it.

The NMHA had two primary parts:

  1. Regulated Supported Use. The first part of the NMHA sets up a legal framework for the supervised use of certain natural medicines (psilocybin and psilocin to start) at licensed Healing Centers with licensed Facilitators. No retail sales of natural medicines are permitted. The natural medicines in the regulated access model could expand to include ibogaine, mescaline, and dimethyltryptamine (DMT), if recommended by the Natural Medicine Advisory Board (Board).
  2. Personal Use. The NMHA also removed state and local criminal penalties associated with growing, processing, consuming, and sharing psilocybin, psilocin, mescaline, ibogaine, and DMT for personal use.

On April 18, 2023, Colorado Senate President Steve Fenberg introduced CO SB23-290 to implement Colorado’s Natural Medicine Health Act with fidelity. This 90-page bill replaces and restates almost all of the NMHA. Although the bill started off with a couple of policy positions that were antithetical to the voter-initiated act, after a series of amendments and a lot of work by Colorado activists and lawyers, it seems clear SB23-290 builds off the intent of the NMHA to create a natural psychedelic ecosystem in Colorado based in equity and safety. As of the time of this writing, the bill has passed both the Colorado House and Senate and is awaiting signature by Governor Polis.

To read more about the process of amending SB23-290, please see read these Vicente Insights articles.


Key Aspects of SB23-290

Indigenous Focus

Section 12-170-107 of SB23-290 establishes the Federally Recognized American Tribes and Indigenous Community working group “for the purpose of engaging and creating dialogue to identify issues related to the commercialization of natural medicine.” The main objectives of this working group will be:

  • Avoiding the misappropriation and exploitation of the federally recognized American tribes and Indigenous people, communities, cultures, and religions
  • Avoiding the excessive commercialization of natural medicine, natural medicine product, and natural medicine services
  • Any conservation issues associated with the legalization and regulation of natural medicine, including further depletion of peyote due to peyote being a source of mescaline
  • Best practices and open communication to build trust between the federally recognized American tribes, Indigenous people and communities, and the regulatory agencies and officials tasked with implementation, licensing, and enforcement

Regulatory Changes

Division of Natural Medicine

A deviation from the NMHA, which appointed the Department of Regulatory Agencies (DORA) as responsible for all rulemaking and implementation, the bill creates within the Department of Revenue (DOR) the Division of Natural Medicine (DNM) for the purpose of regulating and licensing the cultivation, manufacturing, testing, storage, distribution, transport, transfer, and dispensation of natural medicine or natural medicine product between natural medicine licensees. The bill requires the DNM to:

  • Regulate natural medicine, natural medicine product, and natural medicine businesses, including healing centers, cultivators, manufacturers, and testers, and issue licenses for such businesses
  • Promulgate rules necessary for the regulation of natural medicine, natural medicine product, and natural medicine businesses
  • Perform duties necessary for the regulation of natural medicine, natural medicine product, and natural medicine businesses, including investigatory and disciplinary authority

The bill leaves licensing of facilitators as a responsibility of DORA, as well as the promulgation of rules necessary for the regulation of facilitators and the practice of facilitation. DORA will also continue to oversee and support the Natural Medicine Advisory Board and the new Tribal and Indigenous Working Group.

Rulemaking

SB23-290 gives the newly formed DNM and the Director of the Division of Occupations in DORA the authority to promulgate rules for the natural medicine regulated access program. Clear rulemaking authority is given to agency heads on key programmatic pieces.

Coupled with this change, the bill creates the Natural Medicine Facilitator Cash Fund (under DORA) and the Regulated Natural Medicine Cash Fund (under DOR).

Natural Medicine Advisory Board

The bill keeps and slightly modifies the Board contemplated by the NMHA. The Board’s duties are expanded and now include examining issues related to natural medicine and natural medicine products and making recommendations to the Director of the Division of Professions and Occupations and the Executive Director of the state licensing authority. The Board also has a clear mandate to address issues around equity, tiered facilitator training, and other key aspects of the program.

Licensing

SB23-290 extends the timeline for accepting license applications for new licenses, registrations, permits, or certificates to December 31, 2024. The bill directs the DNM to prioritize application processing for applicants who have established residency in Colorado. The DNM will determine the eligibility requirements and privileges under the licenses, registrations, permits, or certificates. Proposition 122 had a limit of 5 Healing Center Licenses per person; this bill keeps that limitation but applies it to any natural medicine business license.

1,000-Foot Distance Requirements

SB23-290 prevents the State Licensing Authority from acting on an application for the issuance of a Natural Medicine Business License if the building where natural medicine services are provided is within 1,000 feet of a childcare center (including residential childcare facilities), preschool, elementary, middle, junior, or high school. Localities have the authority to vary these setback requirements.

No Professional Degree Requirement Unless Licenses are Tiered

The bill notes that the educational and experiential requirements and qualifications for an individual to become a facilitator do not include a professional license or professional degree, similar to the NMHA. The qualifications to be a facilitator do include education and training in the following:

  • Participant safety
  • Drug interactions
  • Contraindications
  • Mental health and state
  • Physical health and state
  • Social and cultural considerations
  • Preparation
  • Administration
  • Integration
  • Ethics

In addition to this, SB23-290 creates new safety precautions around consenting to physical contact with any participant during natural medicine services, including obtaining signed informed consent for permissible physical contact and permitting a participant to withdraw consent for physical content in any manner and at any time.

Telehealth

The bill text permits consideration of conducting the preparation, administration, and integration sessions via Telehealth methods.

Ibogaine

This bill makes the sharing of ibogaine with another person prohibited. The Board is to prioritize considering its addition to the regulated model and may recommend doing so before June 1, 2026, with the approval of the director and executive director of the state licensing authority (DOR).

Taxes

Under federal law, certain expenses are disallowed under section 280E of the Internal Revenue Code (IRC). Under state law, the state income tax code permits taxpayers who are licensed under the “Colorado Marijuana Code” to subtract expenses that are disallowed by section 280E of the IRC. The bill expands this permission to taxpayers who are licensed under the “Colorado Natural Medicine Code.”

Testing

The bill requires the DOR to coordinate with the Colorado Department of Public Health and Environment (CDPHE) concerning testing standards and certification requirements of regulated natural medicine and natural medicine products. It also permits the DOR to create rules around licensed laboratories testing personal use products.

Personal Use

No Personal Possession Limits

SB23-290 does not create any limitation on personal possession, except for a 12-foot by 12-foot cultivation limit which can be waived by local governments.

Reasonable Remuneration Under Personal Use

“Personal Use” does not mean the sale of natural medicine or natural medicine product for remuneration or sharing natural medicine as part of a business promotion or commercial activity. However, the bill establishes that it does not preclude remuneration for bona fide harm reduction services or bona fide support services used concurrently with the sharing of natural medicine or natural medicine product. There may not be any advertisements related to the sharing of natural medicine, natural medicine products, or the services provided.

Unlawful Acts

NMHA decriminalized the personal use of certain natural psychedelics if the person is twenty-one years of age or older and only within the context of counseling, spiritual guidance, beneficial community-based use and healing, supported use, or related services. SB23-290 addresses the following unlawful activity, which is all generally consistent with NMHA:

  • A person under the age of 21 is prohibited from possessing or using natural medicine and may be fined up to $100 or required to attend four hours of substance use education or counseling
  • A person who openly and publicly consumes or displays natural medicine or natural medicine product commits a petty drug offense and is subject to a fine of up to $200 and up to 24 hours of useful public service
  • A person who cultivates natural medicine must do so on their private property in an enclosed, locked area no larger than 12 x 12 feet. A violation of this is a petty drug offense and is subject to a fine of up to $1,000
  • Unless expressly limited, a person who for the purpose of personal use and without remuneration, possesses, consumes, shares, cultivates, or manufactures natural medicine or natural medicine product, does not violate state or local law, except that nothing permits a person to distribute natural medicine or natural medicine product to a person for certain unlawful purposes
  • Testing is expressly permitted under the personal use section if there are signed waivers stating that the products are only to be used for personal use
  • The criminal restrictions on display, cultivation, and sales do not apply to commonly and lawfully sold living plants cultivated for ornamental purposes only
  • A peace officer is prohibited from arresting, and a district attorney is prohibited from charging or prosecuting, a person for a criminal offense under part 4 of article 18 of title 18 involving natural medicine or natural medicine product, unless expressly provided by the bill
  • A lawful action related to natural medicine or natural medicine product must not be the sole reason to subject a person to a civil penalty, deny a right or privilege, or seize assets
  • A lawful action related to natural medicine or natural medicine product must not be used as the sole factor in a probable cause or reasonable suspicion determination of any criminal offense; except that an action may be used in such determination if the original stop or search was lawful and other factors are present to support a probable cause or reasonable suspicion determination of any criminal offense

Record Sealing

Consistent with the vision of NMHA, the bill makes a person eligible to file a motion to have conviction records related to natural medicine or natural medicine product that occurred prior to the passage of the act sealed immediately after the later date of final disposition or release from supervision.

Other Important Provisions

SB23-290 also keeps, but slightly modifies, the express protections that were in NMHA around child rearing, use on probation/parole, receiving public benefits, and insurance coverage.

Stay tuned for a more detailed analysis of the Colorado Natural Medicine Health Act implementation bill, SB23-290.

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