Ending months of speculation, former White House budget director Mitch Daniels (search) filed paperwork Monday to start raising money for a 2004 run for Indiana governor.

The announcement outside the Statehouse came from state Sen. Murray Clark of Indianapolis, who said he was dropping his bid for the GOP nomination to head Daniels' campaign committee.

"He is the right person at the right time," Clark said in his endorsement of Daniels, who did not attend the news conference so he could make calls for support.

Supporters said Clark's withdrawal gave the official start of the Daniels campaign a tremendous boost of contacts and fund-raising strength. Clark was the running mate of gubernatorial nominee David McIntosh in 2000, when they lost to Gov. Frank O'Bannon (search) and Lt. Gov. Joe Kernan. McIntosh is running again next year; O'Bannon is barred by term limits from seeking a third consecutive term.

Daniels, whose last day as White House budget director was Friday, had long been expected to make a run. He made several public appearances during trips to Indiana in recent months and attended GOP Lincoln Day dinners in nine counties.

Several top Republicans have encouraged him to run, and when he announced his resignation as budget chief, President Bush said, "This administration's loss is the gain of the people of Indiana."

Besides McIntosh, three other Republicans are seeking the gubernatorial nomination: state Sen. Luke Kenley, conservative activist Eric Miller and Petersburg Mayor Randy Harris.

Two Democrats - state Sen. Vi Simpson and former state and national Democratic chairman Joe Andrew - are seeking their party's nomination.