Inspector orders Vancouver mushroom dispensary to close – again

Dana Larsen poses outside a Medicinal Mushroom Dispensary in Vancouver, B.C. (Source: Dana Larsen)

The founder of an embattled psilocybin mushroom dispensary in Vancouver's Mount Pleasant neighbourhood has vowed to keep the business running, despite an order from the city's chief licensing inspector.

The closure order is the latest in an ongoing battle between Dana Larsen's Magic Mushroom Dispensary and the city, which suspended the shop's business licence in May 2023 over the open sale of several psychedelic drugs at the West Broadway storefront.

A panel of city councillors voted to re-instate the licence last month – but Larsen told CTV News he was disappointed to receive a letter Sunday informing him that the matter was being sent back to council.

"They're trying to get a do-over," said the long-time drug activist. "Our lawyer's not convinced that's legal – to just go back and get another decision if you don't like the first one."

A copy of the chief licensing inspector's letter, which Larsen shared on social media, acknowledges his successful appeal of the 2023 suspension, but indicates that decision is not binding for this year.

"The 2023 business licence year has concluded and I am unable to re-issue that year's business licence," inspector Sarah HIcks wrote. "While I take the panel decision into account in my consideration of your 2024 business licence application, you continue to sell substances at the premises, including LSD, psilocybin, and DMT, which are prohibited under the Controlled Drugs and Substances Act."

The inspector said she is referring the dispensary's 2024 application back to council to decide whether it should be approved – and that the Magic Mushroom Dispensary must "immediately cease operating" until it has a licence.

"If you continue to operate without a valid business licence, you will be subject to further enforcement actions," she added.

The odds of another approval might be slim.

The three-member panel that oversaw Larsen's last hearing included, by chance, two Green Party councillors who supported his application, overruling the lone representative from Vancouver's ruling ABC party.

Mayor Ken Sim swiftly criticized the decision, accusing the Greens of engaging in "activism beyond the jurisdiction of the city of Vancouver."

Larsen's mushroom dispensary is among at least a dozen that have opened up across Vancouver in recent years, selling drugs that remain illegal federally – following a similar trajectory to the cannabis shops that emerged prior to legalization.

The Green councillors who approved the Magic Mushroom Dispensary's licence used the city's previous approach to so-called "grey market" cannabis businesses as a framework.

But earlier this month, council rejected a motion to continue down that path by exploring the regulated sale of psilocybin in the city.

Despite that, Larsen's lawyer, Jack Lloyd, described the decision to refuse the mushroom dispensary's business licence as a "flagrant disregard for the rule of law," noting that the city had the option of requesting a judicial review if it disagreed with the panel's decision to reinstate it last month.

"They had the ability to appeal the decision, and instead of appealing the decision they just decided not to comply with the order," Lloyd said, adding that they will be requesting their own judicial review instead.

In the meantime, Larsen said the mushroom dispensary will continue operating – as it did following the licence suspension last spring, which eventually led to police raiding the Broadway location and two other mushroom dispensaries Larsen runs in November. 

Larsen noted his dispensaries fund two free drug-testing sites, called Get Your Drugs Tested, on Hastings Street and West Broadway.

Asked about Larsen's criticisms, a city spokesperson reiterated that that panel's decision to re-instate the licence in March 2024 "relates solely" to the dispensary's 2023 licence.