ALBUQUERQUE — The New Mexico Lottery awarded a contract Thursday to a Georgia company for a new computerized gambling system.

The contract with Intralot "represents considerable savings from current contract rates," said lottery spokeswoman Linda Hamlin.

The lottery expects to save about $35.4 million over its current contract with Gtech. It pays Rhode Island-based Gtech about 8.5 percent of annual online ticket sales and $1.4 million a year for retail terminal and communications fees.

The new seven-year contract calls for the lottery to pay Intralot a base price of 1.5 percent, or $18.2 million, on projected total net sales of $1.15 billion over the life of the contract. The base price includes all ticket sale terminals and related equipment for 1,100 lottery retailers as well as a communications network.

The new system is to become operational on Nov. 21, 2008, when the contract with Gtech expires. The lottery and Intralot are allowed to sign three one-year contract extensions at the end of the original term.

The lottery's board of directors voted in July to approve Intralot, which allowed final contract negotiations to begin. The only other bidder was Gtech.

"Intralot was the lowest bidder, and it offered the products and services best suited to help the lottery increase sales and generate more revenue for legislative lottery scholarships," the lottery's chief executive officer, Tom Romero, said.

Net revenues from lottery sales go to the scholarship program, which pays tuition for New Mexico residents attending in-state institutions of higher learning.

Intralot's contract calls for 500 ticket scanners that will allow players to check their tickets for prizes and 225 ticket vending machines capable of dispensing both scratcher games and drawing games such as Powerball. Current vending machines dispense only scratcher games.

Self-service capabilities will help the lottery expand among retailers who have been reluctant to sell tickets because of space and staffing limitations, Romero said.

The lottery, which began in 1996, has raised more than $331 million for college tuition.