The Colorado Lottery's search for a new director will be an in-house effort among state employees.
The state does not envision the need to hire outside of government or outside of Colorado, said Diane Reimer, spokesman for Michael Cooke, director of the Department of Revenue. The department oversees the lottery.
"We are confident of finding somebody within state government," Reimer said Tuesday. "We hope to have someone on board by the end of December."
The new director will oversee an agency that state auditors say has excessive expenses and questionable accounting practices. The audit was concluded in October and was made public Monday.
The director will replace Mark Zamarripa of Pueblo, who abruptly resigned his $111,000-a-year job last month. He has said his resignation was for personal reasons and was not related to the audit.
Zamarripa had worked for the Colorado Lottery since its inception in 1983 and served as the director for the past nine years.
Zamarripa's resignation was effective last Friday. He was paid for his unused vacation, Reimer said, but did not receive a severance package. The state does not give cash payouts for unused sick leave.
Among the state audit's findings:
" Proceeds to open space and recreation - which is why voters approved the lottery - declined as expenses increased. Travel and cell phone bills were among the expenses questioned.
" Bonuses were routinely handed out and not tied to performance. Lottery sales employees in 2002 received an average bonus of $6,800.
" The lottery could reach new customers by considering sales at coffee shops and discount warehouses, as noted in research by the agency.
Cooke and interim lottery director Tom Thornburg have already implemented some recommendations made by auditors and have set up a timetable to implement the others.