Administrator of The SBA
Preston was nominated to be the 22nd Administrator of the U.S. Small Business Administration on April 25, 2006. Small business advocates questioned the nomination since Preston had never started or worked for a small business. In his Senate confirmation hearing, Preston said SBA is “a big business that supports the needs of small businesses … an organization that requires sophisticated financial management, operational responsiveness, and a customer service culture among the workforce” and SBA leadership must have “a mind for big business but a heart for small business.”
Preston was unanimously confirmed by the Senate on June 29, 2006. He took over SBA at a time when the agency was under fire for its disaster loan operation’s response to Hurricanes Katrina, Rita, and Wilma. Preston pledged to improve processing and disbursement of SBA disaster loans to storm victims at his confirmation hearing. Ultimately, the agency distributed approximately $6 billion in loans to those victims. Under Preston, SBA completely reworked disaster operations, implementing reforms that cut key processing times for disaster loan applications by up to 90 percent.
On the day Preston was sworn in, CBS “Evening News” criticized the agency’s lax enforcement of small business contracting rules, a failure members of Congress said resulted in more than $12 billion in contracts going to large companies like Microsoft and Rolls Royce. Preston worked to bring transparency to the process by closing loopholes, tightening the small business contract definition, and developing a new scorecard for federal contracting agencies. The SBA ordered agencies to eliminate inaccuracies in the federal small business contracting database and recertify their size status regularly.
In 2006, SBA ranked dead last among federal agencies in the Partnership for Public Service’s Best Places to Work Survey. SBA improved its ranking 30 percent in the 2009 survey, the most improved among large federal agencies. The score for SBA leadership improved 36 percent in the survey.
Preston drove many other operational reforms throughout the agency, including changing the loan guaranty program to make it more effective and easier to use. Sen. John Kerry (D-MA) praised the reforms: “Preston is widely credited with correcting major problems at the Small Business Administration … Mr. Preston inherited an agency in disarray, and he’s worked hard to right its course and to improve relationships with Congress … We may have some differences on policy, but he’s always been professional, responsive, and dedicated to the mission.”
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