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HF 978 – Medical Psilocybin, Post-Traumatic Stress Disorder Treatment (LSB1463HV)
Staff Contact: Lindsey Ingraham (515.281.6764) lindsey.ingraham@legis.iowa.gov
Fiscal Note Version – New
Description
House File 978 relates to the production of psilocybin and administration of psilocybin to
persons with post-traumatic stress disorder (PTSD) and does the following:
• Creates a Psilocybin Production Establishment Licensing Board within the Department of
Health and Human Services (HHS) and establishes criteria for membership on the Board.
The Board is not subject to dissolution pursuant to Iowa Code section 4A.5.
• The Bill requires the Board to begin accepting license applications on July 1, 2026
(FY 2027).
• Establishes the process for renewal or revocation of a license. Each license will be renewed
annually so long as the licensee meets the requirements for initial licensure, and significant
failure of compliance or grounds for revocation are not identified.
• Establishes that psilocybin production establishment agent registration cards expire after
two years and can be renewed if the agent is still eligible.
• Establishes that an individual can only recommend a medical psilocybin treatment if the
HHS registers the individual and issues a qualified medical psilocybin provider registration
card.
• Establishes that in order to be recommended psilocybin by a qualified medical psilocybin
provider, a patient must be at least 21 years old and be diagnosed with PTSD.
• Establishes that an individual can only administer a medical psilocybin treatment if the HHS
registers the individual and issues a qualified medical psilocybin therapist registration card.
A qualified psilocybin therapy provider can only administer psilocybin in a qualified therapy
provider location.
• Establishes that an individual can only act as a qualified therapy provider agent if the HHS
registers the individual and issues a qualified therapy provider agent registration card.
• Establishes that qualified therapy provider agent registration cards expire after two years
and can be renewed if the agent is still eligible.
• Requires the HHS to adopt administrative rules to administer the provisions of the Bill. In
cooperation with the Department of Agriculture and Land Stewardship and the DPS, the
HHS must adopt administrative rules for the creation and operation of an electronic
verification system.
• Limits the number of psilocybin recommendations in the State to 5,000 patients.
• Requires the HHS to submit an annual report to the General Assembly on or before
November 1, 2025, and each year thereafter regarding the participation in the medical
psilocybin program.
• Requires the HHS to submit a report regarding the medical efficacy of psilocybin to the
General Assembly, including recommendations, by June 1, 2028.
The Bill establishes various fees, the amounts of which will be determined by the HHS through
administrative rule. Fees are established by the Bill in the following ways:
• An applicant for a psilocybin production establishment license is required to pay an
application fee. The HHS will deposit these fees into the General Fund.
Fiscal Note
Fiscal Services Division 2
• An applicant who is approved for a psilocybin production establishment license is required to
pay an initial licensing fee. The HHS will deposit these fees into the General Fund.
• An applicant for a psilocybin production establishment license is required to pay a fee to the
HHS to cover the costs of the DPS criminal background check to be remitted to the Division
of Criminal Investigation.
• A licensee who applies for renewal of their license is required to pay a renewal fee.
• A psilocybin production establishment agent is required to pay a fee to receive and to
renew their psilocybin production establishment agent registration card.
• An applicant for a qualified medical psilocybin provider registration card is required to pay an
application fee.
• An applicant for a qualified medical psilocybin therapist registration card is required to pay
an application fee.
• An applicant for a qualified therapy provider agent registration card is required to pay an
application fee.
• A qualified therapy provider agent is required to pay a fee to renew their qualified therapy
provider agent registration card.
The Bill establishes that a simple misdemeanor has been committed in the following
circumstances:
• A psilocybin production establishment agent fails to carry the individual’s psilocybin
production establishment agent registration card. The fine for a first or second offense
within a two-year period is $100. A third or subsequent offence in a two-year period is a
simple misdemeanor as punishable by law.
• A qualified therapy provider agent fails to carry the individual’s quality therapy provider
agent registration card.
• An individual violates a provision of Iowa Code chapter 124F, created by the Bill for which
another penalty is not provided. The fine is $100.
The Bill establishes that a serious misdemeanor has been committed in the following
circumstances:
• A person negligently or recklessly releases any information from the State electronic
verification system in violation of Iowa Code section 124F.22.
• An individual intentionally or knowingly violates a provision of Iowa Code chapter 124F or
violates a provision of that chapter three or more times. The fine is $1,000.
The Bill establishes that a Class D felony has been committed in the following circumstances:
• A person knowingly and intentionally releases any information from the State electronic
verification system in violation of Iowa Code section 124F.22.
• A person who unlawfully obtains or attempts to obtain information from the State electronic
verification system by misrepresentation or fraud.
• A person who unlawfully obtains or attempts to obtain information from the State electronic
verification system for a purpose other than the purpose authorized in Iowa Code chapter
124F.
• A person knowingly and intentionally uses, releases, publishes, or otherwise makes
available to any other person information obtained from the State electronic verification
system for any purpose other than a purpose specified in Iowa Code section 124F.22.
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Background
Oregon legalized psilocybin use in 2020, and Colorado legalized psilocybin use for therapeutic
use in 2022.
A simple misdemeanor is punishable by confinement of no more than 30 days and a fine of at
least $105 but no more than $855. A serious misdemeanor is punishable by confinement for no
more than one year and a fine of at least $430 but not more than $2,560. A Class D felony is
punishable by confinement for no more than five years and a fine of at least $1,025 but not
more than $10,245.
Assumptions
• The following will not change over the projection period: charge, conviction, and sentencing
patterns and trends; prisoner length of stay (LOS); revocation rates; plea bargaining; and
other criminal justice system policies and practices.
• A delay of six months is assumed from the effective date of this Bill to the date of first entry
of affected offenders into the correctional system.
• Marginal costs for county jails cannot be estimated due to a lack of data. For purposes of
this analysis, the marginal cost for county jails is assumed to be $50 per day.
• The HHS will require additional staff to implement the Bill. Figure 1 shows the required
personnel and their salaries for FY 2026 and FY 2027.
Figure 1 — HHS Personnel Salaries for HF 978
• There will be an estimated $224,000 in additional operating costs for the HHS for FY 2026
for Information Technology (IT) project management, IT vendor services, hardware,
environmental costs, and other administrative expenses. For FY 2027, the operating costs
are estimated to be $102,000.
Correctional Impact
House File 978 creates new criminal offenses, and the correctional impact cannot be estimated
for the Bill due to a lack of existing conviction data. A conviction for a simple misdemeanor
does not result in a prison sentence but does carry the possibility of confinement in jail for up to
30 days. Figure 2 shows estimates for sentencing to State prison, parole, probation, or
Community-Based-Corrections (CBC) residential facilities; LOS in months under those
supervisions; and marginal costs per day for Class D felonies and serious misdemeanors.
Refer to the Legislative Services Agency (LSA) memo addressed to the General Assembly,
Cost Estimates Used for Correctional Impact Statements, dated January 13, 2025, for
information related to the correctional system.
Job Classification
Estimated
FY 2026
Estimated
FY 2027
Executive Officer 2 90,000$ 93,000$
Management Analyst 3 0 85,000
Clerk Specialist 0 55,000
Total 90,000$ 233,000$ 4
Figure 2 — Sentencing Estimates and Length of Stay (LOS) in Months
Minority Impact
House File 978 creates new criminal offenses. As a result, the Department of Management
Criminal Justice Planning cannot use existing data to estimate the minority impact of the Bill.
Refer to the LSA memo addressed to the General Assembly, Minority Impact Statements, dated
January 13, 2025, for information related to minorities in the criminal justice system.
Fiscal Impact
House File 978 may increase the number of convictions under Iowa Code chapter 124, but the
extent of the increase in costs to the Department of Corrections (DOC) is unknown. Figure 3
shows the average State cost per offense for a simple misdemeanor, a serious misdemeanor,
and a Class D felony. The estimated impact to the General Fund includes operating costs
incurred by the Judicial Branch, the Indigent Defense Fund, and the DOC. The cost would be
incurred across multiple fiscal years for prison and parole supervision.
Figure 3 — Average State Cost Per Offense
House File 978 is estimated to increase costs to the HHS by $314,000 for FY 2026 and
$335,000 for FY 2027. This includes the costs for additional staff needed by the HHS and
operating costs. Figure 4 shows the breakdown of the annual costs of implementing HF 978.
Figure 4 — HF 978 Estimated Costs
Sources
Department of Corrections
Department of Management, Criminal Justice Planning
Department of Health and Human Services
/s/ Jennifer Acton
April 21, 2025
Doc ID 1525342
The fiscal note for this Bill was prepared pursuant to Joint Rule 17 and the Iowa Code. Data used in developing this
fiscal note is available from the Fiscal Services Division of the Legislative Services Agency upon request.
www.legis.iowa.gov Conviction Offense Class
Percent
Ordered to
State Prison
FY 2024 Avg
LOS in
Prison (All
Releases)
Marginal
Cost per
Day
Percent
Ordered
to
Probation
FY24 Field
Avg LOS
on
Probation
Avg Cost
per Day on
Probation
Marginal
Cost CBC
per Day
Marginal
Cost per
Day Jail
FY24
Field Avg
LOS on
Parole
Marginal
Cost per
Day Parole
D Felony Non-Persons 83.9% 13.1 $24.51 69.5% 39.0 $7.68 $18.37 $50.00 16.5 $7.68
Serious Misdemeanor 2.4% N/A $24.51 53.4% 18.8 $7.68 $18.37 $50.00 N/A $7.68 Offense Class Average Cost
Simple Misdemeanor $40 to $420
Serious Misdemeanor$420 to $5,000
Class D Felony $11,900 to $19,100 Expenses
Estimated
FY 2026
Estimated
FY 2027
Salaries for HHS 90,000$ 233,000$
Operating Costs 224,000 102,000
Total 314,000$ 335,000$