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The Senate sponsor of legislation to strip the railroad industry of antitrust exemptions on Monday asked to cancel a Senate vote on his bill, saying he has reached an agreement to have it included in other railroad legislation.

A key vote on the antitrust legislation was scheduled for Tuesday.

Sen. Herb Kohl, D-Wis., said in a letter to Senate colleagues that he has reached an agreement with Sen. John Rockefeller, D-W.Va., to have the antitrust legislation included in a different bill that would overhaul the regulatory agency that oversees rail transportation.

The agreement resolves a dispute between the two senators that emerged late last week.

Rockefeller, the chairman of the Senate Commerce Committee, had been a supporter of Kohl's legislation but changed course last week and urged the Senate to block final consideration of the bill.

Rockefeller said the antitrust bill would undercut his legislation to overhaul the Surface Transportation Board, which regulates rail competition.

On Monday, Kohl and Rockefeller said in joint letter that they "are working on harmonizing our two efforts to produce a robust reform package."

"This is a high priority for both of us and we are absolutely committed to finding real solutions that can be enacted into law this year," the senators said.

The rail industry has been adamantly opposed to Kohl's bill, saying it would create considerable uncertainty in the industry and discourage private investment.

Shippers, including companies in the energy, chemical and agricultural industries, support the bill, complaining that rail freight prices have been too high.

Four rail companies dominate the rail shipping business: Norfolk Southern Corp. (NSC), Burlington Northern Santa Fe Corp. (BNI), CSX Corp. (CSX) and Union Pacific.

Among other things, Kohl's bill would repeal legal provisions that make certain railroad transactions exempt from review by antitrust regulators and that allow freight railroads to engage in collective ratemaking.

Rockefeller had criticized some provisions of Kohl's bill.

A senate staffer with knowledge of the negotiations between the lawmakers said one controversial provision of Kohl's bill will likely not be included in Rockefeller's legislation. That provision would provide that in legal disputes, federal trial judges wouldn't have to defer to the jurisdiction of the Surface Transportation Board, whose oversight has been criticized as too friendly to the railroads.

-By Brent Kendall, Dow Jones Newswires; 202-862-9222; brent.kendall@dowjones.com