State schools Superintendent Nancy S. Grasmick, a Democrat, announced yesterday she will not join Republican Rep. Robert L. Ehrlich Jr. as a running mate in his campaign for governor.

Grasmick, 63, said in a statement that she believes she can contribute more to state education in her present job, which she has held for a decade.

"It is clear to me that I am already in the best possible position to make a difference for all children," she said. "I appreciate the respect that Congressman Ehrlich has afforded me in placing my name on a list of potential candidates. Our working relationship has always been excellent. At this point, however, I am honored to serve the state in my current capacity."

State political circles have buzzed for more than a week with speculation that the high-profile educator might switch parties to join Ehrlich's ticket. The congressman has said he has narrowed his running-mate search to three finalists, but has not disclosed names.

Grasmick faced a deadline of yesterday to change party affiliation, a legally required step if she were to run on the GOP ticket. By not making the switch, she took herself out of contention.

Ehrlich said Grasmick visited his Timonium home Thursday for their longest substantive discussion over the possibility of becoming running mates. By the end of the evening, he said, he was convinced that Grasmick was not seeking a career change.

"When someone like Nancy Grasmick has interest, I have interest, too," said Ehrlich, 44. "She was not looking for a job. That's the bottom line."

Sources say Grasmick was not initially under consideration, but her candidacy was promoted by some Baltimore-area business leaders, notably John Paterakis Sr., a developer and owner of H&S; Bakery Inc.

"I wasn't trying to persuade her, because I had real questions about a lot of things, including her interest," Ehrlich said. He said he warned her that the race against Lt. Gov. Kathleen Kennedy Townsend, the probable Democratic nominee, would soon turn ugly.

"You've never gone through anything like this," Ehrlich said he told Grasmick. "If you have any qualms at all, you need not go further than this."

Ehrlich said he was not personally disappointed by his friend Grasmick's decision.

On Wednesday, Grasmick had lunch with Townsend and state Comptroller William Donald Schaefer, who as governor named Grasmick to the state's top public education job.

"It was an excellent exchange," Schaefer said yesterday. "They got off their minds things that were worrying them." He said Grasmick did not seek promises or assurances in return for forgoing the race and the lieutenant governor did not offer any deals.

"They didn't dictate terms. They cleared the air," Schaefer said. "What [Grasmick] said was, 'I care about the kids, and I need to be with someone who cares about the kids.' ... There were no threats, no hostility, no tears, no yelling. Just a good conversation between two people who care about education."

Grasmick has clashed with Gov. Parris N. Glendening, who has tried to oust her. She has enjoyed better relations with Townsend, who previously worked under Grasmick at the State Department of Education, developing a community service program for Maryland students.

Asked who arranged the luncheon meeting, Michael Morrill, a spokesman for Townsend, said the event was "mutually facilitated." Townsend and Grasmick also had a "very warm conversation" yesterday afternoon, after the decision was announced, he said.

Grasmick "made it clear she was staying as superintendent because her genuine first priority was education," Morrill said. "It is the same conversation they've had month after month, year after year: They are in sync on their philosophies, and the lieutenant governor looks forward to continuing to work with the superintendent."

To be successful in his campaign, Ehrlich will need heavy support from Democrats, and joining with a well-known member of the state's majority party would bolster his bid. Ehrlich has said that his bumper stickers that read "Another Democrat for Ehrlich" are among the campaign's hottest items.

"There are a lot of Democrats who want us to win, and they thought this was a vehicle to put us over the top," Ehrlich said.

But some Republicans were turned off by Grasmick's advocacy of a strong centralized education bureaucracy and push for school standards that have eliminated some local control.

"I took some grief from the base," Ehrlich said, "but that did not dissuade me."

Under state law, Ehrlich and Townsend have until July 1 to announce their running mates.