LOS ALAMOS, N.M. (AP) — Los Alamos National Laboratory will have a new director at the start of the year.

Officials with Los Alamos National Security, LLC, the contractor that manages the northern New Mexico lab, announced Tuesday that Terry Wallace will take over as director and company president Jan. 1.

Wallace will replace Charles McMillan, who announced his retirement earlier this year. Wallace currently serves as the lab's principal associate director for global security.

Officials say Wallace's national security expertise makes him the right person for the job. He will oversee a $2.5 billion budget and thousands of employees.

Los Alamos National Security's multibillion-dollar contract to manage the lab expires in 2018 and federal officials have started the bidding process.

The lab also has come under increased scrutiny for a series of safety lapses that included the mishandling of nuclear material.