Denver City Council Monday night passed a historic bill that sets the rules and regulations for the retail marijuana industry in the state’s largest city.

Most other big municipalities around Colorado have taken a time-out from setting their own regulations with many opting out to see how Denver’s system will work. Denver also was the first to take on medical marijuana regulations.

“The whole world is watching, not just the country,” said Councilman Charlie Brown, who led the council committee on the issue. “There will be some changes. It is a work in progress. We did what we could, but this is a huge unknown.”

Brown said he wants to hold another meeting with Denver’s police chief, the manager of parks and recreation and some municipal judges to talk about how to enforce the laws against public marijuana consumption.

Several council members were upset after a free marijuana giveaway Sept. 9 in Denver’s Civic Center park that included public pot smoking, which is against the law. No one was arrested or cited for the violations.

“When people are blatantly flaunting our laws and putting it in our face, that is not what we want for the city,” Brown said.

Now, he said, it is up to Congress to pass legislation that will allow a normal banking relationship within this industry. He cited a bill being sponsored by U.S. Rep. Ed Perlmutter, D-Golden.

“They aren’t allowed to have a normal banking relationships,” he said. “That leads to crime, leads to people cheating on taxes. It is absurd. I talked to owners who have to make payroll for up to 60 employees in cash and utility bills in cash. An all-cash business is not good for anyone.”

On Monday, two changes were put into the new law:

• Any medical marijuana facility that has not applied for a city license by Oct. 1 will be shut down.

• Distances now will be measured as the crow flies, not in terms of distance a pedestrian can walk after an amendment by Councilman Paul Lopez that was approved. Going forward, no new dispensary or retail shop can be within 1,000 feet of a school, child care center, drug and alcohol treatment center or another marijuana facility as the crow flies.

Here are some key elements to the new law:

• Through Jan. 2016, only licensed medical marijuana businesses in good standing will be licensed to sell retail marijuana.

• Retail marijuana stores can share the same location with a medical marijuana centers.

• Public hearings will be required before licenses are granted to retail facilities. But the hearings will be less restrictive than liquor licences.

• Similar buffering to the medical marijuana laws will be in effect with no dispensaries allowed within 1,000 feet of a school, child care center, another marijuana facility and drug and alcohol treatment facilities.

Michael Elliott, director of the Medical Marijuana Industry Group, said Denver’s ordinance treats the industry fairly, promotes public safety, and respects the wishes of the voters.

“As a new industry, we recognize and accept the responsibility to ensure responsible use by adults and to keep this product away from minors,” he said in a statement. “We look forward to continuing to work with the city to meet those shared goals.”

Jeremy P. Meyer: 303-954-1367, jpmeyer@denverpost.com or twitter.com/jpmeyerdpost