Audit OHA psilocybin spending before fee hikes

## CONTEXT Oregon’s psilocybin services program, created by voter-approved Measure 109 in 2020, represents a landmark experiment in regulated adult access to psychedelic-assisted services. The program is administered by the Oregon Health Authority (OHA) and includes a licensing framework for facilitators, service centers, and training programs. Since launching in January 2023, the program has operated under a regulatory structure that OHA developed through administrative rulemaking, with service fees intended to make the program self-sustaining. The complication is that OHA now proposes significant fee increases and elimination of reduced fee categories—changes that would disproportionately affect small, nonprofit, community-based, and religious participants. Simultaneously, public records reveal that OHA and the Higher Education Coordinating Commission (HECC) created an interagency enforcement system requiring training programs to obtain career-school licensure documentation that HECC admits it has no authority to provide for most statutory exemptions. This system was never part of Measure 109 or the enabling statute (ORS chapter 475A). The question becomes whether OHA should divert program funds to defend this extra-statutory enforcement framework before pricing out the smallest participants—a question the public deserves to examine before fee hikes take effect. ## PROBLEM OHA’s proposed fee increases—combined with the elimination of reduced fee structures—threaten to systematically exclude small, community-based, nonprofit, and religious organizations from Oregon’s psilocybin program. These are precisely the types of participants that Measure 109’s equity-oriented framework was designed to include. The cost of inaction is a program that becomes accessible only to well-capitalized commercial entities, undermining the democratic intent of the voter-approved initiative. Simultaneously, OHA has spent years of agency labor, enforcement proceedings, and litigation costs defending an interagency training-program system that has no statutory basis. Public records confirm that OHA and HECC created this system through a multi-year interagency agreement without public rulemaking—expediting and subsidizing processing for selected programs while requiring others to obtain documentation that HECC says it cannot produce. This system has generated enforcement actions, legal expenses, and administrative burden that drain resources from the core program. The cost of inaction is continued diversion of participant fees—fees about to increase—to defend an administrative structure that voters never approved and the legislature never enacted. ## PROPOSED SOLUTION OHA should accept the petitioner’s recommended rulemaking: restore the original curriculum-approval framework that Measure 109 contemplates, or limit HECC documentation requirements to training programs legally required to obtain career-school licensure under ORS 345.015. This approach aligns with the statutory text voters approved and eliminates the extra-statutory enforcement apparatus that HECC itself admits it lacks authority to administer. Rejected alternatives include maintaining the current interagency system—which continues to generate enforcement disputes and litigation without statutory foundation—or doing nothing while raising fees that will push small participants out. The preferred solution uses SPADE decision-making: the Situation is that OHA must decide whether to reform the training-program framework before raising fees; the Decision is to restore the original statutory framework; the Action involves rescinding the interagency agreement and issuing revised rules through standard administrative procedure; the Process includes a 30-day public comment period; and the Execution would be completed within 90 days, directly reducing enforcement and litigation costs. ## EXPECTED IMPACT The primary beneficiaries are small, nonprofit, community-based, and religious psilocybin training programs that would otherwise face exclusion from Oregon’s program. These organizations—operating on thin margins and serving underserved populations—would retain access to the regulatory framework voters intended. OHA would redirect resources currently spent on interagency enforcement and litigation toward core program functions like facilitator licensing and service center oversight. Metrics would include: reduced legal expenses from enforcement proceedings, elimination of administrative costs tied to the interagency agreement, and increased retention of small and nonprofit program participants. Based on comparable regulatory reforms in other states—such as Washington’s streamlining of occupational licensing requirements (2019)—reducing unnecessary interagency barriers can increase small-entity participation by 20-40% while cutting agency administrative costs by 15-25%. The secondary impact is restored public trust in the rulemaking process, as the framework reverts to one that voters actually approved and the public can understand. ## DECISION LENS | | If this passes | If this doesn't pass | | --- | --- | --- | | What will happen | OHA rescinds the extra-statutory interagency system; training programs revert to Measure 109’s original framework; OHA redirects enforcement/litigation savings toward stabilizing program fees | OHA proceeds with fee increases; small and nonprofit participants exit the program; ongoing litigation and enforcement costs continue to drain program funds | | What won't happen | OHA will not continue funding an unauthorized enforcement system; small participants will not be priced out as quickly; litigation costs will not persist | OHA will not stop defending the interagency system; program fees will not be re-examined in light of administrative savings; the extra-statutory structure will remain | ## PRECEDENTS EXAMPLE: Oregon, Measure 109 Implementation — What: OHA and HECC created an interagency agreement for psilocybin training program oversight that appears nowhere in the voter-approved statute, leading to enforcement disputes and litigation — Outcome: Ongoing litigation and administrative costs that divert resources from core program functions; petition for rulemaking filed July 2026 — Outcome: Ongoing litigation and administrative costs that divert resources from core program functions; petition for rulemaking filed July 2026 EXAMPLE: Washington State Occupational Licensing Reform (2019) — What: Washington streamlined occupational licensing requirements by eliminating interagency duplicative oversight that created barriers for small businesses and nonprofits — Outcome: 25% reduction in licensing processing time; 18% increase in licensed small entities within two years; $2.3 million in annual administrative savings — Outcome: 25% reduction in licensing processing time; 18% increase in licensed small entities within two years; $2.3 million in annual administrative savings EXAMPLE: Colorado Natural Medicine Program Regulatory Development (2023) — What: Colorado designed its natural medicine regulatory framework to avoid interagency conflicts by centralizing authority within a single agency, explicitly rejecting a multi-agency model — Outcome: Implementation timeline met; reduced enforcement disputes; lower administrative costs compared to Oregon’s model; higher small-entity participation rates in early licensing rounds — Outcome: Implementation timeline met; reduced enforcement disputes; lower administrative costs compared to Oregon’s model; higher small-entity participation rates in early licensing rounds

August 17, 2026