Katie McGinty, Gov. Wolf's chief of staff for the last six months, resigned Wednesday and is expected to soon enter the 2016 Democratic primary election for the U.S. Senate.
Wolf's press secretary, Jeff Sheridan, on Wednesday said McGinty told the governor that it would be her last day on the job.
Speculation has swirled in recent weeks around McGinty and the Senate race, fueled in part by her meeting two weekends ago with officials from the Democratic Senatorial Campaign Committee on Martha's Vineyard.
Before that, a "Draft McGinty" campaign had cropped up on Twitter and YouTube.
An official announcement about McGinty's departure from the Wolf administration is scheduled for Thursday morning.
Her plans beyond that are still taking form, according to a source close to McGinty.
An assistant who answered McGinty's mobile phone Wednesday said she was unavailable for comment.
Her departure comes as Wolf struggles with the Republican-controlled General Assembly about a state budget that is now three weeks overdue.
McGinty is expected to challenge former U.S. Rep. Joe Sestak in the Senate primary.
Sestak was his party's nominee for the Senate in 2010, losing to Republican former U.S. Rep. Pat Toomey, who is now seeking a second six-year term as Pennsylvania's junior senator.
The Democratic National Committee tried to recruit Josh Shapiro, chairman of the Montgomery County Commission, for the race but he declined. Allentown Mayor Ed Pawlowski launched a campaign for the seat but suspended that effort this month after FBI agents raided his office.
A Philadelphia native who now lives in Chester County, McGinty, 52, served in President Bill Clinton's administration and then headed the state's Department of Environmental Protection during Gov. Ed Rendell's administration.
McGinty sought the 2014 Democratic nomination for governor, finishing last in a four-candidate race with just 7.66 percent of the vote. Wolf won that primary with 56 percent of the vote.
McGinty ran an unrelentingly positive campaign, avoiding the more rough-and-tumble tactics employed in that race by former U.S. Rep. Allyson Schwartz and former state Treasurer Rob McCord.
"She didn't raise enough money to be a real factor," Rendell said Wednesday about the 2014 primary. "But she did well in the debates. Everywhere she went, people liked her. She's a smart and charismatic person."
When Wolf launched a political action committee to help him win the 2014 general election, he put McGinty in charge of the effort, which helped him defeat Republican Gov. Tom Corbett.
As Wolf's chief of staff, McGinty has been something of a lightning rod for Republicans, who viewed her as too political for that job.
A top Republican even said last month that he had told Wolf he preferred she wasn't in the room when the budget was being negotiated.
State Senate Majority Leader Jake Corman (R., Centre) was reacting to a speech McGinty made at a monthly press club luncheon in Harrisburg, during which she assailed Republican senators for voting for a pension measure she asserted would hurt most employees but spare lawmakers. Her statement turned out to be inaccurate.
Despite Corman's request, McGinty has been a fixture at most negotiating sessions and a key player in the administration's strategy.
By all accounts, Wolf will move swiftly to replace her, possibly even announcing his decision Thursday, administration officials said.
Possible replacements include Wolf's policy secretary, John Hanger; the governor's legislative liaison, Mary Isenhour; and David Sweet, a longtime lawyer and lobbyist who is now a special adviser to the governor.
Rendell said McGinty had sought his advice about a Senate run 21/2 weeks ago. He said he told her that Sestak, while considered "unorthodox" and even "odd" by many Democratic Party officials, was a tough candidate.
"Because he's odd and different, they underestimate him," Rendell said. "He does march to his own drum. There's no question about that."
Sestak, 63, ran in the 2010 Senate primary against longtime Sen. Arlen Specter, who had left the GOP to run as a Democrat. President Obama, Vice President Biden, and Rendell campaigned for Specter, who lost.
Rendell noted that Sestak came within two percentage points of beating Toomey, even though 2010 saw a national wave of Republican victories, including Corbett's.
Rendell predicted that former Secretary of State Hillary Rodham Clinton could boost the effort of any Democrat running statewide in Pennsylvania if she is the party's 2016 nominee for president. Clinton has strong family ties in the Scranton area.
That could be particularly potent politically for McGinty, with the focus of that race being on Clinton's chances to be the country's first female president. Pennsylvania has never sent a woman to the U.S. Senate.
Still, Toomey, 53, is a strong candidate with a significant lead in fund-raising, Rendell cautioned.
Toomey, in a campaign finance report filed last week, showed that he had $8.3 million in his campaign account as of June 30.