Sen. Fritz Hollings (D-S.C.) announced today that he will retire at the end of his current term after serving nearly four decades in the Senate.

“I want to confirm what you all have suspected, that I will not be opting for re-election this year,” said the 81-year-old Hollings during a news conference in Columbia, S.C. “I’ll always regret it because I hate to stop.”

His retirement comes as no surprise to close observers of Palmetto State politics. Hollings had raised only $122,000 in the first six months of 2003 and had greenlighted the state party to search for other candidates while he was making up his mind.

His announcement comes just eight months after he finally became South Carolina’s senior Senator. Despite holding his seat for 38 years, he had been the junior Senator during his entire tenure because the late Sen. Strom Thurmond (R) was the senior Senator until his retirement after the last Congress.

Hollings, known for his blunt and at times caustic personality, did not disappoint today: “We’ve got the weakest president and the weakest governor in my 50 years in elected office.”

Even as the news of Hollings’ departure echoed from Columbia, talk of an impending Senate bid by state Superintendent of Education Inez Tenenbaum (D) continued to grow. Knowledgeable Democrats expect her to join the race within the week.

“Inez Tenenbaum would be a tremendously strong candidate in a state that has a very weak Republican field right now,” said Democratic Senatorial Campaign Committee Communications Director Mike Siegel.

“She is not only a proven vote-getter she also comes to the table with impeccable credentials,” he said.

Rep. Jim DeMint, former state attorney general Charlie Condon and wealthy Charleston developer Thomas Ravenel are all in the race on the Republican side. Myrtle Beach Mayor Mark McBride is also in the GOP contest but is not given a real chance at winning.

The retirement is widely seen as another blow to the Democrats’ chances of regaining the Senate majority.

“Without Fritz Hollings, the Democrats are starting from scratch, which makes this a great opportunity for Republicans,” said National Republican Senatorial Committee Chairman George Allen (Va.).

Tenenbaum was elected to her current post in 1998 and re-elected last year with 59 percent of the vote. She was initially more interested in challenging Gov. Mark Sanford (R) in 2006 but Sanford’s strong approval ratings may have swayed her to reconsider the Senate race.

Tenenbaum, whose wealthy husband was a longtime finance chairman of the South Carolina Democratic Party, ran statewide unsuccessfully in 1994, losing a primary for lieutenant governor.

Although Tenenbaum is likely to be the choice of the party establishment both in Washington and South Carolina, Columbia Mayor Bob Coble (D) had not ruled out the race, several sources said Monday.

Hollings’ departure was met with praise for his service from both sides of the aisle.

“Senator Hollings has a great ability to set aside philosophical differences and work with anyone for the betterment of our state,” said Sen. Lindsey Graham (R-S.C.). “It’s a trait I admire and should serve as wise guidance for all of us representing South Carolina in Congress.”

Sen. John Edwards (N.C.), one of the nine Democrats seeking the presidency, called Hollings a “giant.” Hollings is the ranking minority member on the powerful Senate Commerce Committee.

“Throughout his decades of public service, he has been an outstanding advocate for the people of South Carolina and the nation,” added Edwards, who is hoping to notch a strong showing in South Carolina’s Feb. 3 primary.

Hollings was elected to the Senate in 1966 to fill the unexpired term of Sen. Olin D. Johnston (D), who died in office. He was re-elected in six times. He sought the Democratic presidential nomination in 1984.

Hollings is the second Democratic Senate retirement this cycle. Earlier in the year Sen. Zell Miller (Ga.) announced he would not seek a second term. Only Sen. Peter Fitzgerald (Ill.) has said he will not pursue re-election on the Republican side.