The announcement followed weeks of speculation as to whether Palms would seek the Democratic nomination for the seat that Sen. Strom Thurmond will vacate when his term expires.

"This has been the most difficult professional decision of my life," Palms said. "We are in the midst of our bicentennial celebration, the University currently faces unprecedented budget cuts, and the need for private financial support for Carolina has never been greater. I do not believe my departure as president at this time would serve the University well."

Palms said considerations for his wife and family also were major considerations in his decision.

"We have fulfilled our roles for the University these past 10 years with a devotion and a passion which have required us to sacrifice time with our close and growing family," he said. "This sacrifice has been intensified during the Bicentennial Campaign. A successful Senate campaign and meaningful Senate service would demand a continuation of this level of commitment."

Members of the Board of Trustees expressed appreciation for the Palms' service to the University and gratitude for the decision to remain at USC through June 2002 while a presidential search takes place.

Trustee and former board chair William Hubbard will chair the search. The Executive Committee will meet in the next few days to begin the process of selecting members of the search committee.