Alan Hevesi is toast. Though he will probably still edge past his Republican challenger, J. Christopher Callaghan, his career as State comptroller—capping close to four decades in public service—is on its last legs. Hevesi easily handled Callaghan in last week’s NY1 televised debate, where he made his Republican challenger look like the not-ready-for-prime-time player that many observers (including many Republicans) assume him to be. The debate largely focused on the recent allegations that Hevesi misused taxpayer funds to chauffeur his wife, and the subsequent ethics commission findings revealed that these allegations are true. During the debate, Hevesi repeatedly denied that he had done anything wrong; still, the tide is clearly shifting against him. The comptroller can easily dismiss calls from the Republican Party and State Senate Majority Leader Joseph Bruno as nothing more than partisan attacks. But when the non-partisan good government group Citizens Union is calling for you to resign, you’ve got real problems.

“It is hard to understand how he could have made such a mistake through simple omission given that he made the very same mistake as comptroller of the City of New York. That this mistake was uncovered by his opponent raises concerns over whether Mr. Hevesi would ever have reimbursed the state had it not been for his opponent’s inquiry. His transgression calls into serious question his ability to be effective as the state’s fiscal watchdog,” said Dick Dadey, executive director of Citizens Union, following the release of the ethics commission report.

So it’s all downhill from here. Conventional wisdom holds that Hevesi will remain in office through the election, defeating Callaghan in the process. In January, under likely new governor Eliot Spitzer, Hevesi will resign his office. Spitzer has made a campaign promise of reforming Albany, noting that on day one “everything changes.” On day one, that change will begin with Hevesi.

And then it will be time to make an appointment. When it comes to statewide offices, New York does not have special elections. Rather, decisions are made through the state Assembly. When it comes time to replace Hevesi, the two men with the most say will be Spitzer, who will recommend a candidate, and Assembly Speaker Sheldon Silver, who will rally his troops to approve that candidate.

Already, the rumor mill has been buzzing about just who might be the next comptroller. Queens City Councilman David Weprin has seen his name floated. Former mayoral candidate Fernando Ferrer is a contender, as is Bill Mulrow and a whole host of others. But Weprin does not have the high profile he thinks he does, and Ferrer is a three-time loser who would reek of patronage at work were he selected. Insiders are hardly confident that Mulrow, who lost to Hevesi in the 2002 Democratic primary, would be a suitable replacement to Hevesi, competent as he may be.

“Silver would probably like to give it to an Assembly member,” said one Democratic assemblyman who asked not to be identified. “But that would look too much like a reward for loyalty, and this will be the first real test for reform.”

The logical candidate for the seat would be the City’s own comptroller, William Thompson. Since replacing Hevesi in 2002, Thompson has run an active, focused office and has been scandal free. When Mayor Michael Bloomberg handed over the City’s public school concessions to Snapple in 2003—in what many saw as quite a sweetheart deal—Thompson was the first to stand up and question the deal’s fiscal merits. He was not making points as a partisan Democrat; he was demanding answers as the City’s accountant.

You never hear a bad word uttered about Thompson, and everyone I speak to admires his work in the comptroller’s office and his overall friendly nature. Even Republicans, Thompson’s political opposites, think he has done a good job in the comptroller’s office, viewing him as a pragmatist who is more interested in actual accomplishment than seeing his name in the newspaper.

Thompson has his eyes on the mayor’s office in 2009, but that race could be a very divisive, nasty affair. Congressman Anthony Weiner and Bronx Borough President Adolfo Carrión Jr. (among others) would be waiting for him in the Democratic primary; and Time Warner CEO Richard Parsons could be preparing his own run as a Republican. If Thompson were offered the comptroller seat, he would get to avoid all that—have a safe job for the next eight years and be poised to make history not as the second African-American mayor but as the first African-American governor. All in all, Thompson’s a no-brainer.

“It would be very hard for anyone to say no to Bill Thompson,” added the assemblyman. “We couldn’t do much better.”