One minute, Larry and Jesse were sitting on black milk crates, panhandling outside Rite Aid in downtown Burlington. The next, they were spread-eagled against the wall with three uniformed cops frisking them for contraband.

The police showed up as Seven Days was interviewing Larry and Jesse — who declined to give their last names — about a proposed ban on sidewalk sitting. The cops had been watching the men for hours, a detective told me, and suspected them of drug dealing. For 30 minutes, police emptied their backpacks and turned their pockets inside out on the sidewalk, while pedestrians with shopping bags strolled nonchalantly by.

When it was over, Larry walked away with a no-trespass order that prohibits him from entering Rite Aid for a year. Police slapped both men with $50 tickets for having open beer cans, but neither was charged with drug possession. Larry and Jesse were slightly rattled by the encounter but hardly seemed surprised.

“We were just next in line,” says Larry, a cheery 61-year-old with a Santa Claus beard and a black-and-white bandana on his head.

Panhandlers such as Larry and Jesse have reason to feel targeted as the Burlington City Council considers an ordinance that would all but outlaw sitting on sidewalks downtown. Police Chief Michael Schirling has proposed the ban in response to complaints by pedestrians — including several in wheelchairs — that people sitting or lying on sidewalks are blocking their passage.

The no-loitering zone would extend six feet from buildings on the streets that intersect the Church Street Marketplace: Pearl, Cherry, Bank, College and Main, between South Winooski Avenue and St. Paul Street. The first offense would trigger a warning; the second, a fine of $50 to $500.

Reaction to the idea has been swift and fierce, with residents who oppose the ban telling city councilors the idea is “shameful” and “despicable.”

“People come to Burlington because it’s a town full of freaks,” local activist Greg Nixon told the council on May 17. “You’re trying to make it into a shopping mall, and we don’t want a shopping mall. We want this to be Vermont.”

The proposed ban exposes the rift between merchants who say that sidewalk squatters are bad for business and local activists who see the move as a not-so-subtle attempt to rid downtown of the down-and-out.

Both sides will have their say at a public hearing on June 8.

The proposed sitting ban raises a number of questions: How big a problem is sidewalk squatting? Who is complaining about it, and how often? Do police already have the tools they need to keep the peace downtown without imposing a blanket prohibition on the use of public space? Is this a lawsuit waiting to happen?

The answers depend on whom you ask, but consider these facts: Burlington police have received roughly 50 “blocked sidewalk” complaints in the past two years. The exact number is unknown because police don’t keep track of them as “incidents,” Schirling says.

“It’s not a topic that yields a lot of calls to come do something specific,” the chief explains, “because at this point there’s not a lot that we can do.”

On any given day, sidewalks on downtown side streets are sprinkled with busking musicians, panhandlers holding cardboard signs and restaurant customers dining at outdoor café tables. Police have not arrested anyone sitting on a sidewalk for being disorderly, Schirling says, and in most cases, sidewalk sitters aren’t doing anything illegal. They’re just hanging out.

But the chief says the situation is crying out for a fix. Complaints about sidewalk squatters tend to come in three varieties, he says. One is from people who have had to alter their routes — wheelchair users forced into the street, for instance — to avoid individuals or groups that were blocking the way.

Another type of complaint comes from business owners who object to individuals blocking an entryway.

The third complaint variety concerns what the chief calls “inappropriate behavior” by sidewalk denizens: swearing, screaming and having “inappropriate conversations” around children.

Burlington already has an ordinance on the books aimed at blocked sidewalks — Section 27-4 under the “Streets and Sidewalks” chapter. Enacted in 1962, the one-sentence ordinance states that no person “shall unnecessarily occupy, obstruct or encumber ... a sidewalk so as to interfere with the convenient use of the same by the public.” It doesn’t set punishments for violators.

But Schirling argues that the existing ordinance is “vague” and that an updated, more specific prohibition is needed to enforce sidewalk right-of-way. Creating a 6-foot buffer downtown seemed like a reasonable solution, the chief says.

“I really don’t see this as heavy-handed or disproportionate,” Schirling says. “It’s about as mild-mannered as we could come up with.”

Local Motion, the Burlington-based group that advocates for pedestrians as well as cyclists, doesn’t see blocked sidewalks as a huge problem, says executive director Chapin Spencer.

“Most pedestrians are still able to get through on sidewalks,” Spencer says. “It’s not so full of people lying down that we can’t get through.”

What can be a problem, Spencer says, is some of the behavior of those loitering downtown.

“We can’t let antisocial behavior proliferate,” Spencer says. “Burlington’s vibrancy does hinge on a safe and welcoming pedestrian environment. You look at sales-tax numbers by town, and Burlington is losing the war every year, becoming less of a shopping destination.”

The question of who owns downtown has been the subject of intense debate in recent weeks. Business owners, all but a few of them speaking anonymously, figured prominently in a front-page Burlington Free Press story on May 24. The suggestion was that threatening and unruly behavior by folks loitering on Church Street is driving business away. But taxes from sales receipts show exactly the opposite — city revenues from local option taxes are up over those from 2009.

Fears about increased crime from halfway houses may also be unfounded. Negative reaction to a proposal from Burlington Housing Authority to open a 20-bed facility for ex-inmates a block off Church Street is contradicted by the success of Northern Lights, a transitional residence for female ex-cons.

Larry and Jesse say they’ve seen intimidating and aggressive panhandlers downtown, and watched pedestrians cross the street to avoid walking by them. The duo blames “out-of-staters” for such behavior, and says peaceful panhandlers shouldn’t be lumped with aggressive ones.

“I can see Rite Aid not liking us sitting there badgering their customers,” Larry says. “But we weren’t doing that.”

After police booted them from outside Rite Aid, Larry and Jesse wandered down to City Hall Park, where they sat on a bench and cracked two fresh beers. “I’m just a drinker,” Larry says. “I don’t fight. I don’t cause trouble.”