WASHINGTON -Jody M. Wagner plans to step down as Virginia's secretary of finance at the end of this week and go back to her home in Virginia Beach. While Wagner said she has no specific plans, sources said they expect her to run for lieutenant governor next year.

Gov. Timothy Kaine announced Wagner's plans to resign Friday. When asked about her intentions, Wagner would only say, "I'm assessing my options," and that she "certainly" wants to "continue to be involved in serving Virginia."

Wagner, the first female secretary of finance in the state, was appointed by Kaine in 2006. Prior to that, she served as treasurer in former Gov. Mark R. Warner's administration.

If Wagner runs for the state's number two executive position, she would face Jon Bowerbank, a businessman and a member of the Russell County Board of Supervisors, who is already running as a Democrat. Current Lieut. Gov. Bill Bolling, a Republican elected in 2005, also plans to run for re-election.

In Virginia, governors cannot serve back-to-back four-year terms, but lieutenant governors may serve consecutive terms.

Wagner unsuccessfully ran as a Democratic candidate for the U.S. House, who would have represented the Norfolk region in 2000.

Kaine had nothing but praise for Wagner on Friday.

"Jody Wagner's fiscal stewardship is one of the reasons why Virginia has been named best managed state and best state to do business," Kaine said. "Her dedication and talents have secured Virginia's triple-A bond rating and helped keep Virginia on the right track in a challenging economic environment. She has devoted herself to service, putting Virginia first, and she will be missed as an invaluable member of my team."

Wagner worked with the General Assembly this year to pass a $1.6 billion higher education bond package. She is also credited with working closely with Kaine to reduce state spending by about $1.3 billion to balance the state budget after the downturn in the national economy.

"It has been wonderful to be part of both the Kaine and Warner administrations and I'm grateful that I had the opportunity to work with both of them," she said Friday.

Wagner will be replaced by Richard Brown,who currently serves as director of the state's Department of Planning and Budget, a position he has held since 2002. Brown, a native of Arlington County, received his bachelor's degree in economics from the College of William and Mary and a master's of commerce degree from the University of Richmond.

Deputy secretary of finance Daniel S. Timberlake will succeed Brown.

Timberlake worked for two years as an analyst with the Virginia Department of Transportation, and 10 years as a budget analyst with the Virginia Department of Planning and Budget. Timberlake, who is from Mechanicsville, is a graduate of the College of William and Mary.

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