Colorado Gov. John Hickenlooper (D) announced the compromise on Monday (Photo: Matthew Staver/Bloomberg)

Four ballot initiatives that would have put the debate over oil and gas drilling front and center in the midterm elections in Colorado will be withdrawn after both environmentalists and energy industry backers agreed to a temporary cease-fire brokered by Gov. John Hickenlooper (D) — one that could help Democrats avoid a complicated political dance in November.

The agreement postpones a fight over local control of oil and gas drilling, a booming industry in energy-rich Colorado. Environmentalists, led by U.S. Rep. Jared Polis (D), had proposed two ballot initiatives that would have required drilling rigs to be set 2,000 miles away from homes and schools, and given more control over drilling licenses to local communities.

In response, the energy industry advanced two initiatives of their own, one that would have prohibited the state from sending oil and gas tax revenue to communities that prohibited drilling and another that would have changed the way ballot initiatives are presented to the public.

Instead of fighting it out at the ballot box, the two sides will come together on an 18-member task force to recommend solutions to the state legislature. The task force will be co-chaired by one backer of the environmentalists’ initiatives, La Plata County Commissioner Gwen Lachelt (D), and one representative of the oil and gas industry, XTO Energy President Randy Cleveland.

Any recommendations from the panel will require a two-thirds vote in favor, forcing coalition-building among environmental and energy interests.

Both sides claimed victory on Monday. Polis said the commission would put citizens “on equal footing” with the oil and gas industry, giving them the ability “to negotiate directly for regulations that protect property rights, home values, clean water and air quality.” Spokespeople for several energy companies and industry interest groups agreed.

“The good news for Coloradans is that a robust system focused on citizens’ concerns is already in place and the announcement of this task force seems to confirm the proper place for strong regulations and enforcement of oil and natural gas development is ultimately in the hands of our state environmental agencies,” said Jon Haubert, a spokesman for Coloradans for Responsible Energy Development, an industry group.

Other groups were worried that the environmental initiatives could open the door to new local restrictions on other industries. Bill Midcap, a spokesman for the Rocky Mountain Farmers Union, said the initiatives might have allowed local communities to regulate agriculture activities, too. “The compromise looks good to us,” Midcap said in an e-mail.

The deal means neither side will have to spend the tens of millions of dollars required to run what was certain to be an expensive campaign. The two sides had already raised more than $10 million to wage the November campaign, the Denver Post reported.

But the big winners may be the candidates who stay on the ballot, particularly the Democrats. Hickenlooper, Sen. Mark Udall (D) and other Democrats would have been put in the difficult position of choosing between environmentalists, who are becoming an increasingly important source of campaign funds for Democratic candidates, and oil and gas industries that could spend big bucks against them.

“The Democrats have really dominated the state for close to a decade, and one reason is they weren’t divided on anything,” said Floyd Ciruli, an independent pollster based in Denver. “It would have been a very high profile argument in which the Democrats were going to be on the defensive.”

“They’re very pleased that it’s become a committee of 18 that will take this off the front page,” Ciruli added.

Democrats had urged Polis, who represents liberal Boulder, to shelve his initiatives, and Hickenlooper tried to come up with a compromise that could pass the narrowly-divided state legislature. But he said last month he would not call a special session after the two sides failed to reach a compromise.

Environmental groups have made Udall’s re-election a top priority. Organizations like the League of Conservation Voters and the Environmental Defense Action Fund have spent $1.8 million on advertisements defending him and attacking his rival, Rep. Cory Gardner (R). Tom Steyer, the billionaire environmental activist who has pledged to spend $50 million of his own money on the midterms, has pointed to Udall’s as a critical race.

On the other side of the issue, the Chamber of Commerce and the American Energy Alliance have spent almost $1 million on Gardner’s behalf. Polls show Udall and Gardner running neck and neck in the Senate race, while Hickenlooper is trying to fend off a strong challenge from ex-Rep. Bob Beauprez (R).

Oil and gas tax revenue has helped the state rebound from the recession, and most voters support both expanding energy development and stricter environmental regulations.

Udall came out against the environmental ballot initiatives in July, despite his reputation as an avid environmentalists. At the time, Udall said the initiatives didn’t fit with Colorado’s long-standing efforts to balance clean air and water standards with energy development.

In a statement Monday, Udall applauded the compromise. “From the beginning, I have pressed everyone involved to find a balanced way forward and to work toward a collaborative solution. I am proud this engagement yielded results,” Udall said. “This deal — which averts a divisive and counterproductive ballot fight over one-size-fits-all restrictions — is welcome news.”

Under the agreement, Hickenlooper will also ask the Colorado Oil and Gas Conservation Commission to dismiss a lawsuit against the city of Longmont, which imposed new restrictions on oil and gas development that were far stricter than state standards. The city required new oil and gas wellheads to stay 750 feet away from the nearest home.