It's a complicated process, but I'll do my best to explain how it works.
First, the Majestic XII has to decide to open the moderator books. This happens roughly every 23 to 27 months. It's called the "Twenty Three to Twenty Seven Month Quell." A combination of charts, equations, Jim Beam, and a washing machine are used to determine the exact time frame. Once the M-XII declares "the moderator books are open", there is a special M-XII committee that selects members as a possible moderator candidates. Usually, 31 members are "tapped" as potential mod candidates, but that number can be a little higher or a little lower depending on that season's quell. "Tapped" candidates will find Hartford Whalers jersey slipped under their door. Once the 31 members are selected as a potential mods, there are a series of grueling physical and mental tests in which each candidate must participate. Secrecy forbids me from being specific about the tests, but I can tell you that they're not easy.
Of the initial 31 (give or take) candidates, the number that make it through the initial process averages about 4.7. Some quells may produce five or more candidates while other quells have been a complete waste of everyone's time because no one got past round one. The candidates who survive the initial process are then subjected to another series of even more grueling physical and mental tests. Again, I can't be specific, but I can tell you that part of it requires building an air compressor from scratch. Generally, 1-2 candidates will make it past round two of testing. Those candidates are then voted on by the full membership of the Majestic XII. The M-XII vote must be unanimous. If the vote is not unanimous, the M-XII will post a picture of a Cleveland Browns helmet with a random logo on it. If the vote is unanimous and a new mod has been selected, the M-XII will post a picture of an NFL helmet with a gray face mask to let the masses know that a decision has been made and a new moderator has joined the ranks.
Hope that explains it.