Will Colorado Look to Rein In Prop 122’s Personal Use Clause?

A Q&A with Psychedelics Attorney Sean Allister


A legal pioneer and in both cannabis and psychedelics, Sean McAllister was one of the key thought leaders behind Colorado’s Natural Medicine Health Act, aka Prop 122. His firm, McAllister Law Office, serves a wide range of clients interested in psychedelics, from religious spiritual practitioners to psychedelic assisted therapists, ketamine clinics and pharmaceutical companies interested in the space.

Sean is licensed to practice law in Colorado and California, but consults with clients nationwide. He recently shared some of his thoughts on Prop 122, its rollout that began last month, and the emerging psychedelics industry surrounding it.


How do you feel the process is going in Colorado?

As a lawyer who worked through the transition from illegal cannabis to legal cannabis, I’m seeing a bit of a repeat of the pattern in terms of over-regulation at the beginning. This is because there’s an institutional conservatism. When citizen-led initiatives come in and change the law, government is going to create the most conservative, most cautious, most regulated system they can because it’s new. There’s no upside for being too liberal. And over-regulation not only slows down the rollout, it also makes things more expensive.

Take Oregon. As I understand it, there have been some unexpected institutional slowdowns to their rollout of Measure 109. For example, they didn’t realize that additional state agencies would have to certify facilitator-training programs, which has pushed back the process by several months. There’s also a complexity of rules, like the need for security systems and staff, and installing cameras at psilocybin centers. There’s rules about record-keeping. Even detailed rules about how clients need to be escorted to the bathroom and how that will work. All these rules can make the system prohibitively expensive. We’ve heard estimates that a single psilocybin session will cost between $1,000 and $2,000. That said, I’m optimistic that this early over-regulation will change over time and hopefully bring down those costs.


Last month, Colo. Gov. Jared Polis appointed 15 people to the advisory board that will recommend rules for Prop 122. What do you think of his picks?

There are certainly a lot of experts and some good people here. I’m optimistic that they’ll make some smart recommendations. But one of the concerns in Oregon was that not enough people on the Oregon Health Authority process had deep experience with psychedelics themselves, and I think you’re seeing a similar thing now in Colorado. When you have people who don’t have deep experience — even though they have great credentials as doctors and psychologists and therapists — they’ll have a tendency to be overly protective of how the medicine is used, because they don’t have the experience with it themselves. On the other hand, this a group of smart, publicly oriented people, and hopefully they can be educated and make good decisions.


One of the big differences between the Oregon and Colorado models is that in Colorado, you can not only grow and possess psilocybin mushrooms, but also give them away to anyone over 21. Do you expect the advisory board will recommend additional rules around this, such as possession limits or efforts to prevent alternative forms of payment for mushrooms?

I think some politicians are very nervous about this decriminalization side. If you take the law at face value, it says you can possess as much natural medicine as necessary to share with other adults. It’s modified by a couple words that intend psilocybin use to be in the context of healing, or spiritual counseling, or a beneficial community-based use. So actually, the sharing provision isn’t just some wide open thing. If you said, “I’m going to Red Rocks to party on mushrooms,” technically that would be illegal — unless you could argue that it was community-based use or part of a healing or spiritual program. Some people would say a Grateful Dead show at Red Rocks qualifies as beneficial community-based use. But that makes politicians nervous, because they’re afraid someone will show up with 10,000 doses and start handing them out. That’s the kind of reading of the law these politicians are very concerned about. In fact, there are rumors that some are looking at limiting the personal-use part of this law. We’ll see if that really materializes, but there are certainly credible concerns that they’re going to try to do something to rein in the decriminalization because it’s so broad.


What kinds of clients are you working with in this space?

Oh, everything under the rainbow of Prop 122. I’m talking to retreat centers that want to give away the medicine and charge for services. Doctors and therapists who want to do the same things through their practices. I’m helping religious practitioners set up churches. I’m talking to mushroom grow companies that sell home-growing equipment or substrate that is ready to pop mushrooms at any moment. People are asking about other models, too. What about private clubs? Why can’t we all join together and pay a membership due in a club and the club gives away mushrooms for free?

Again, there is a risk profile to all these business ideas, especially as it relates to federal law enforcement. The legal advice I’m giving is just know where you are on the risk profile. I’d say the safest level is a plant-medicine practitioner or therapist or doctor giving away medicine and charging for services. This is exactly what the law describes, and I think it’s very defensible. Also, of course, selling grow equipment is not risky at all. But selling substrate that’s ready to pop mushrooms? That might be riskier. Also, is a private membership club might be risky.


You’re talking about risks of federal prosecution. And whereas the cannabis industry had the Cole memo to assure businesses they wouldn’t be prosecuted by the DEA, there is no such assurance in the psychedelics industry. Is that right?

Yes. Right now, psychedelic medicine is very different than cannabis with regard to federal law. With cannabis, there was both the Cole memo (which is no longer in effect, by the way) and specific federal appropriations riders that gave business owners some faith that they would not be arrested by a federal agency while doing business in a state where it’s legal. We have nothing like that for psychedelics. But it’s been two years since the Oregon initiative passed and nthere’s been no reaction from the federal government. That said, it’s certainly a concern. If I were 100% risk averse, this would be one of the reasons I might not get involved.


How much is this risk related to who’s President at the time?

I think it matters very much what administration is in office. Even though Biden hasn’t been a great drug policy reformer — yes, he decriminalized cannabis, but overall he hasn’t been a huge reform advocate — he has also allowed these state policy changes in psychedelics to happen. I don’t feel like the Biden administration is going to come in and change that. But if we got, say, Ron DeSantis or Trump again, it’s possible that the federal government could come in and say this is all illegal. So that’s a risk people will have to take.


More than a dozen other states have bills on the table to either research or decriminalize psychedelics. How do you see these initiatives playing out in terms of the overall evolution of psychedelics access and use?

Most of the interest in other states is around research bills, which is actually the opposite of how I would like to see it evolve. Our motto in Colorado was always, “Decrim first.” First just take the criminal penalties out of this whole thing, and then figure out what’s the right way to regulate. But the instinct of political institutions is the opposite: They want regulated access first. They don’t want to decriminalize, because they’re worried about broad access. So they pass research bills instead. But do we really more FDA double-blind placebo studies to show us that mushrooms are effective? It’s such a ridiculous proposition. Can you imagine a Mazatec or Huichol person of Mexico saying, “You know what? We’ve been using these mushrooms for thousands of years, but until we do an FDA study, we’re not going to use them anymore.” So I’m not really impressed with the study bills.

But for state regulated models, in general, I do think Colorado did better than Oregon in terms of thinking about social equity and access. So I hope that’s the model other states use. We could have gone further, of course. We didn’t put any additional taxes on new psychedelics companies, so we won’t be able to create a pot of money that could be used to expand access or increase reciprocity or give-back requirements. I think those issues are the next frontier in terms of policy.

So, now that Colorado’s advisory board is in place and beginning to work on the rules, what do you think is the most important thing they need to get right?

I’d say respecting the indigenous wisdom that’s already out there — and not just imposing a medical model. We didn’t pass a medical model, we passed a therapeutic model. We did not want people to have to get a diagnosis to use these medicines. So I hope they will learn from the wisdom from the indigenous people and incorporate into the program. And also bake in some reciprocity. If we don’t respect and learn from indigenous communities, then we’ll just come at it with a Western medical mentality, and the system will be overly complicated, overly expensive, and not available to most people.