SBA’s Preston to replace Jackson as HUD secretary
President Bush’s decision on nomination came as a surprise because SBA chief's name had not emerged in speculation about who would replace Jackson.
The White House announced Friday that SBA Administrator Steven Preston has been selected to succeed outgoing HUD Secretary Alphonso Jackson, who is under criminal investigation for purportedly favoring friends with contracts at public housing authorities controlled by HUD. Jackson's resignation takes effect today.
President Bush's decision to nominate Preston came as a surprise because his name had not emerged in speculation about who would replace Jackson.
Preston will take over a troubled agency plagued by scandal and political infighting, but his supporters say that he brings the right tools to the job, including steady management, a strong financial background, and good relations with Capitol Hill.
"Steve is a strong executive with a quarter century of management experience," President Bush said in announcing his nomination. "He's had senior leadership roles at two multi-billion dollar corporations and in the financial services industry. He understands the free enterprise system from every angle."
Preston will take the reins as the federal government struggles to deal with the subprime mortgage crisis that has buckled the economy.
"As we help people pursue the American dream, we need to have a market to operate fairly and effectively for all Americans," Preston said at the White House Friday. "And our solutions must restore confidence in our markets, while not erecting barriers to future entrepreneurs, investors and home buyers."
Prior to joining SBA, Preston was executive vice president of The ServiceMaster Company. Earlier, he was a senior vice president and treasurer of First Data Corp., and an investment banker at Lehman Brothers.
"The White House was looking for someone who can keep the cars between the lines at HUD," says a person familiar with the selection process, "and make sure that they finish strong."
Preston, married with five children, was sworn in as SBA administrator July 11, 2006.
According to the SBA Web site, since coming to the agency, Preston has worked diligently "to revamp the Disaster Assistance Program, which was still struggling to respond following the 2005 Gulf Coast hurricanes."
Since Jackson announced his resignation on March 31, speculation about a successor had centered on three men -- Roy Bernardi, the deputy HUD secretary; Brian Montgomery, commissioner of the Federal Housing Administration and assistant secretary for housing; and James B. Lockhart III, the director of the Office of Federal Housing Enterprise Oversight.
Montgomery, who is close to President Bush, pulled his name from consideration last Monday.