Vancouver's first public hearing over licensing marijuana dispensaries sparked backlash on Wednesday, as both sides argued over the finer points of the controversial proposal.

More than 150 people have signed up to speak at the hearings as Vancouver examines the possibility of licensing dispensaries.

Under the proposed licensing plan: the sale of edible pot products would be banned, stores wouldn’t be allowed to operate in certain neighbourhoods, including the Downtown Eastside, or set up shop within 300-metres of schools or community centres, and minors wouldn't be allowed to buy products.

Operators would also be subject to an annual $30,000 fee.

"This is unprecedented in the country," city manager Penny Ballem told CTV News. "Vancouver has stepped out to take this on and try to bring this retail area into regulatory framework and it's never been done."

Ballem says the proposal doesn't look to legalize marijuana, but rather regulate the retail aspect of dispensaries.

“This is a drug that is used by many people for all kinds of different reasons, be it medicinal reasons or for recreation. And the assessment by us and our colleagues is that it’s out there and we have to take some steps just to regulate the business steps around it,” she said. “We’re doing our very best to bring some order to this.”

There are currently 93 marijuana dispensaries across the city, more locations than coffee chain Starbucks.

Despite the proposal, the federal government still views the selling of marijuana in dispensaries as illegal, even if it is for medicinal purposes.

Officials with Vancouver Coastal Health say the proposed plan would help keep the drug out of the hands of minors.

"This is the best way of minimizing the harm," said Dr. Patricia Daly, with the health authority.

She says stores would have plain, limited signage to discourage minors wandering in.

The plan has found some support with dispensary owners who say they want to see their stores treated as legitimate businesses.

"We want to pay proper taxes, we want to make jobs and we want to normalize it. We want to take it out into the open," said Don Briere, the president of Weeds Glass & Gifts.

However, Briere says the proposed fee is too high for many prospective dispensary owners.

The proposed 300-metre zoning limit also upset some, who say the treatment isn't fair.

Lawyer Kirk Tousaw, who represents several dispensary owners as well as a man at the centre of a Supreme Court case over the legality of edible marijuana products, argued against the zoning suggestion.

"These locations have demonstrated a history of responsible operation and newer businesses have not," he said.

He urged city council to examine shutting down dispensaries on a case by case basis, factoring in the level of community support for the business.

But anti-pot activists are upset the city is even examining the possibility of licensing dispensaries.

Pamela McColl, of marijuana prohibition group Smart Approaches to Marijuana Canada, says the city has let residents down.

“I think that if you look around the country and look at places like Manitoba which has one dispensary or Nova Scotia which has none, I think the city has let us down by not cracking down on these and getting them in control,” she said.

The Downtown Vancouver Business Improvement Association has also called on city council to close every marijuana shop in the city.

With files from CTV Vancouver