WASHINGTON - (AP) - President Barack Obama says his chief of staff William Daley is resigning after a year on the job to return to his native Chicago and spend more time with his family.

Obama says Daley will be replaced by Budget Director Jack Lew,whom Obama called the "clear choice" for one of the toughest jobsin Washington.

Although Daley's tenure was rocky and he's leaving earlier thanexpected, Obama praised him warmly in comments in the State DiningRoom on Monday. Obama said Daley had performed "extraordinarywork" in an "extraordinary year."

Both Daley and Lew stood at Obama's side as the presidentdelivered brief remarks, but neither man spoke.