SBA Nominee Faces Tough Questions on Capitol Hill

President Bush's pick to head the Small Business Administration can expect a rough ride at his nomination hearing on Wednesday, Washington officials say.

Steven Preston, a 45-year-old former vice president at a Chicago-based lawn-care company, will face tough questions about how he plans to provide greater access to capital for the nation's small businesses — including an embattled disaster loan program — despite the agency's continually shrinking budget.

Click here to visit FOXBusiness.com's Small Business page.

Critics say he will also have to explain what an executive at a publicly traded company can do for small-business owners.

Sen. John Kerry, D-Mass., the ranking member of the Senate Committee on Small Business and Entrepreneurship, said Preston needs to show he can turn the agency around and "put small businesses first, plain and simple."

"We need a leader who will fight for small businesses, not use the SBA as a platform to enact Bush's big-business agenda," Kerry said in an e-mail to Inc.com.

Apart from access to capital, Kerry said he wants the agency to boost the number of federal contract awarded to small businesses, while expanding opportunities for minorities, women, and veteran entrepreneurs.

Rep. Don Manzullo, R-Ill., chairman of the House Small Business Committee, said in a recent statement that Preston will "meet and exceed the many challenges he will encounter at the helm of the SBA," crediting his "wealth of experience in executive leadership and financial management."

Rep. Nydia Velazquez, D-N.Y., who called on outgoing SBA Administrator Hector Barreto to resign in December citing widespread mismanagement, will be pressing for a broad outline of Preston's vision for getting the agency back on track and "meeting the needs of small businesses," a spokeswoman at her office said.

Velazquez, the ranking Democrat on the House Small Business Committee, has openly questioned the nomination, saying Preston lacks hands-on experience as a small-business owner.

At a meeting in May, Sen. Dick Durbin, D-Ill., who is slated to introduce Preston at Wednesday's hearing, described the nominee as someone who understands business, adding that he is hopeful Preston will "bring that understanding to his work at the Small Business Administration."

The National Federation of Independent Business, the nation's largest small-business lobby, has also endorsed the nomination, saying in a statement that Preston "clearly understands the value of setting goals and achieving results in a large, complex organization."

At The ServiceMaster, which sells lawn-care products through some 5,000 outlets nationwide and made more than $3 billion in revenue last year, Preston oversaw strategic planning, mergers, and acquisitions, with direct authority over 250 employees, according to his resume.

He has also worked as a treasurer at First Data Corporation and an investment banker with Lehman Brothers.

Yet despite such credentials, other small-business advocates on Capitol Hill said they want assurances that Preston will better manage the SBA's disaster loan programs, both in the Gulf Coast and elsewhere.

Sen. Mary Landrieu, D-La., who was also highly critical of Barreto's stewardship, will be looking for "some sort of commitment to address the systematic short-comings of the agency's response to Katrina," said Adam Sharp, Landrieu's spokesman. "She wants to know that someone is minding the store."

Since his nomination on April 26, Preston himself has kept a low profile, refusing requests for media interviews ahead of this week's hearing.

Barreto, who has served as SBA administrator since July 2001, announced his resignation in April, after facing criticism over the agency's handling of disaster loans in the Gulf Coast after Hurricane Katrina, among other issues. He was also faulted by critics for shortfalls in the agency's flagship 7(a) program, while failing to meet small-business contracting targets for minority-owned businesses.

Barreto has been tapped as the next chairman of the Latino Coalition, a Washington-based lobby.

Click here to visit FOXBusiness.com's Small Business page.