Change to Category Selection on Add Listing page

I have a very long list of Categories.
They are NOT organized into Sub Categories, they are all Parent Categories. (After MUCH experimenting this way works best for the functionality of my site…)

I wish to modify the tpl-add .php to achieve this:

Set item #2 “Listing Category” to open only to a specific fixed height and the contents to scroll within that set height instead of having it open the full list of categories which goes on too long and is not terribly user friendly. Can I either put a window within the window or… just better control it somehow?

I’ve been looking over the tpl-add.php code to see if I could figure it out but I am stumped.

Screen captures attached:
One of how it looks now
Other is how I wished i could get it to look (I just photoshopped it to my “Ideal” look)

I can’t provide URL, my site is still in development.
Thanks in advance if you can help me.