Retailers hoping to sell pot in Edmonton later this year may be at the behest of fate.

City administration is proposing a lottery system to help determine who gets a development permit for a cannabis shop when marijuana becomes legal this year.

The random selection process would help the city avoid prejudice in screening applicants, city staff said at a public hearing Monday at city hall.

For prospective retailers who have already invested in design, leases and architecture work, the proposed lottery leaves too much to chance.

"It's disturbing because private industry has had to put a lot of money into this process so far," Fire & Flower president and CEO Trevor Fencott told CBC News Monday. "We were not notified at all that this was going to be the case."

Municipalities award development permits and business licences, while the Alberta Gaming and Liquor Commission (AGLC) is responsible for approving the provincial operating licence for cannabis retailers.

The AGLC said it had received 482 applications for cannabis retail licences as of April 30.

Fencott believes those who have already applied to the AGLC for provincial approval should be considered more seriously by the city.

"It's a very high level of commitment and it's a heck of a lot of work that goes into that process," he said.

Trevor Fencott, president and CEO of Fire & Flower, says a lottery system is the opposite of free-market business. (Fire & Flower)

Fire & Flower is vying for 16 permits in Edmonton and if left up to chance, it may have to pull out of some of its retail spaces.

"You can't invest in lotteries," Fencott said.

Coun. Ben Henderson said he was concerned from the beginning about how the city would choose business owners.

In popular areas like Whyte Avenue, which is in Henderson's Ward 8, it's going to be a challenge.

"There's no way you could fit them all in," Henderson said. "The only way to do it fairly is to allow everybody to put their application in at the [same] time and draw randomly."

Mayor Don Iveson believes the rules around marijuana sales will change over time.

"I suspect this is something that's going to evolve," Iveson said.

Before the proposed random selection process, the city plans to accept expressions of interest from May 22 to June 12 and will finish screening applicants by June 20.

City council agreed to revisit the lottery option at a meeting later this month.

City council considers input from speakers at a public hearing Monday on cannabis zoning bylaws. (CBC)

Also Monday, council discussed a zoning bylaw which requires cannabis shops to be 200 metres from a school or public library and 100 metres from a park, recreation centre or provincial health-care facility.

It also requires cannabis stores to be 200 metres apart.

A public survey showed distance from schools was the most important part of the separation component of the bylaw.

The city received 4,100 responses to the online survey posted between Nov. 14 and Dec. 7, 2017.

@natashariebe