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Oregon Health Authority drops effort to double psilocybin licensing fees

Oregon Health Authority drops effort to double psilocybin licensing fees

Rule Changes

Industry pushback and a survey predicting revenue losses convinced regulators to abandon the fee hike rulemaking

Yesterday: OHA drops fee hike rulemaking

Overview

Updated 1 hour ago

Oregon regulators scrapped a plan Tuesday that would have doubled licensing fees for the state's psilocybin therapy program. The Oregon Health Authority (OHA) said feedback from its advisory board, rule committees, and public comment convinced it to abandon the rulemaking process.

The reversal follows an industry survey suggesting the fee hikes would backfire: 80% of licensees said they would not renew, and one analysis projected licensing revenue would fall 56%. The program still faces a budget gap the fee hike was meant to close, and OHA plans a separate rulemaking this winter that excludes fee changes.

Why it matters

Doubling fees would have driven most of Oregon's licensed psilocybin providers out of business, cutting the regulatory revenue the increase was supposed to produce.

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Key Indicators

80%
Licensees who said they would not renew at proposed fee rates
117 of 146 licensees surveyed by facilitator Sam Gross said they would drop out.
56%
Projected decline in licensing revenue under fee hike
Revenue would fall from about $1 million to roughly $463,000 as licensees left the market.
$4.25M
Projected program deficit under license attrition scenario
OHA's own fiscal modeling showed the shortfall could grow by about $360,000 with the fee hike.
$4,000
Proposed annual facilitator license fee
Had doubled from $2,000; service center and manufacturer fees would have risen from $10,000 to $20,000.

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People Involved

Organizations Involved

Timeline

November 2020 September 2026

7 events Latest: Yesterday
Tap a bar to jump to that date
  1. OHA drops fee hike rulemaking

    Latest Decision

    Agency announces it will not adopt the fee increase rules, citing industry feedback.

  2. Hearing draws unified industry opposition

    Testimony

    Sam Gross presents survey showing 80% of licensees would not renew at proposed rates.

  3. Public comment period opens on fee proposal

    Public Comment

    OHA publishes proposed rules doubling all fees and eliminating discounts for veterans and others.

  4. Rules Advisory Committee meets on fee changes

    Consultation

    Committee meets over four days to discuss proposed rules, including doubling fees and eliminating reduced-fee tiers.

  5. OHA holds listening sessions on proposed rules

    Engagement

    Agency opens rulemaking that will include significant changes to all fees.

  6. Psilocybin program opens

    Milestone

    First licensed facilitators and service centers begin operating in Oregon.

Scenarios

1

OHA finalizes fee-neutral rules in December

Likely Resolves by Jan 15, 2027

Discussed by: Oregon Health Authority; Oregon Psilocybin Advisory Board

OHA has said it will open a new rulemaking process in the coming weeks, with a public comment period anticipated in December 2026 and an effective date of January 15, 2027. The agency has indicated the new rules will be unrelated to the fee changes.

2

Oregon legislature funds psilocybin program

Possible Resolves by Q2 2027

Discussed by: Sam Chapman, Center for Psychedelic Policy

With fees off the table and the program still running a deficit, the 2027 Oregon Legislative session must decide how to fund oversight. Chapman's Center is running an independent economic analysis on whether psilocybin therapy is cost-effective for the state.

3

OHA brings back scaled-down fee increases

Uncertain Resolves by End of 2027

Discussed by: Oregon Psilocybin Advisory Board; industry groups

OHA could reintroduce fee increases in future rulemaking, potentially scaled to operator size or restoring reduced-fee tiers, as it continues to pursue a self-sustaining program. The budget gap remains unresolved.

Historical Context

2 moments from history that rhyme with this story — and how they unfolded.

January 2018 – June 2022

California cannabis tax squeeze (2018-2022)

California legalized recreational cannabis in 2016, but state excise and cultivation taxes plus local fees pushed effective rates well above 30%. Legal operators struggled to compete with a thriving unlicensed market, and state cannabis revenue came in far below projections.

Then

Legal sales underperformed while the illicit market persisted.

Now

In 2022, California's budget deal suspended the cultivation tax and reduced the excise tax, acknowledging the fee structure was choking the legal market.

Why this matters now

Mirrors the trade-off Oregon faced: raising costs on legal operators can shrink the licensed market and reduce, not increase, regulatory revenue.

November 2022 – June 2025

Colorado psychedelic rollout struggles (2023-2025)

Colorado voters passed Proposition 122 in 2022, creating the second state-regulated psychedelic therapy program in the US. The rollout faced repeated delays and struggled to establish a self-sustaining regulatory framework before healing centers began operating in June 2025.

Then

The regulated market opened later than planned with funding constraints.

Now

Colorado's experience shows first-in-nation psychedelic programs typically take years to find a workable fee structure.

Why this matters now

Colorado faced the same core problem Oregon is wrestling with: a novel regulated market that is supposed to fund its own oversight but cannot yet.

Sources

(7)