SBA Nominee Is Quizzed On Disaster Aid, Franchises Steven Preston, President Bush’s nominee to head the Small Business Administration, told senators “disaster assistance is Job One” for the agency. At a confirmation hearing June 21 before the Senate Small Business Committee, Preston responded to widespread criticism of SBA’s slow reaction to Hurricane Katrina. Committee Chair Olympia Snowe (R-ME) said the agency had showed “no sense of urgency” in processing disaster loans after the storm. Although SBA has approved more than $10 billion in disaster loans, she said only 20.5% of the loans have been disbursed. SBA officials have said that is because many borrowers are still waiting to gain access to their property and get permits to rebuild. Preston, who has been executive vice president of the large franchising company ServiceMaster, said his experience working with franchisees is one of his qualifications to head SBA. “I have been in the middle of small business activity my entire professional life,” he testified. “I have worked with investors and their portfolio companies on strategic and operational issues, helping franchisees become more effective through training, funding and business process support, and working as an investment banker with successful small businesses that have become large enough to tap the public and private capital markets.” But he declined to say whether he believes franchisees should be eligible for small business set-asides. House Small Business Committee Chairman Donald Manzullo (R-IL) has proposed opening set-asides to franchised businesses if they qualify as small under SBA’s size standards. ServiceMaster and McDonald’s are headquartered in his home state. Under questioning by the Senate committee’s ranking Democrat, John Kerry (MA), Preston said, “There are a lot of flavors of franchisees and a lot of different ownership structures.” Kerry said ServiceMaster had lobbied to end small business set-asides in the lawn care industry. One of the corporation’s brands is TruGreen ChemLawn, a landscaping and lawn care franchise. Preston said he was not involved in the lobbying and was not familiar with the issue. Kerry, a persistent critic of the Bush administration’s cuts in the SBA budget, told Preston, “I welcome your nomination.” He cited Preston’s management experience as a plus in an agency where, he said, “There’s been too much politics.” SBA’s funding has been cut by 37% since President Bush took office. Kerry accused the administration of a “starvation policy” that shows “disrespect for the SBA” and its programs. He urged the nominee to stand up to White House budget cutters. “Above all, please do not come back and tell us that it is possible to ‘do more with less,’” Kerry said. “At some point – and we have reached that point – it is not possible.” The committee has not scheduled a vote on the nomination.