Steve Preston
Encyclopedia
Steven C. Preston served as the 14th Secretary
of the U.S. Department of Housing and Urban Development from 2008 to 2009 and the 22nd Administrator of the U.S. Small Business Administration
from 2006 until his appointment as HUD Secretary. Before entering public service, Preston spent nearly 25 years in financial and operational leadership positions in the private sector.
, Wisconsin
and attended Parker High School
where he was class valedictorian
, president of the student congress, and a varsity wrestler. His mother grew up in Germany during and after World War II and his father was born in an Appalachian coal-mining camp. Preston has four siblings.
Preston earned a B.A.
with Highest Distinction in political science
from Northwestern University
in 1982 and an MBA from the University of Chicago Graduate School of Business in 1985.
During the first half of his private sector career, Preston worked in investment banking and corporate finance. Preston joined Lehman Brothers
in 1985, ultimately serving as a Senior Vice President in the Investment Banking Department.
In 1993, Preston moved to First Data Corporation where he was Senior Vice President and Treasurer. He managed capital structure strategies, financial risk management, and investor relations during a period of rapid growth.
Preston moved to The ServiceMaster Company
in 1997 where he served as Executive Vice President and Chief Financial Officer for seven years before heading the company’s Strategic Services effort. In 2000 CFO magazine named him one of the “Next Wave” of financial executives that would make a difference in the next decade.
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 attempted 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. By correcting erroneous data, the federal government was required to reduce its previously reported small business procurements by $4.6 billion, causing total contracts to fall below the 23 percent congressional mandate. Some small business advocates did not think Preston’s reforms went far enough. House Small Business Committee Chairwoman Nydia Velazquez (D-NY) said, “The fact that large businesses are being awarded with small-business contracts, and that there is no system in place with penalties or consequences for this, is extremely concerning.”
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.”
With less than nine months left in his Administration, President Bush nominated Preston to be HUD Secretary on April 18, 2007.
As his predecessor departed amidst scandal, housing advocates and Senate Banking, Housing, and Urban Affairs Committee chairman Chris Dodd (D-CT) criticized Preston for his lack of previous housing policy experience. With the housing crisis unfolding, President Bush said he needed someone with Preston’s background in finance: “I looked for a leader with an impressive background in finance; someone who understands the important role the housing market plays in the broader economy. I sought a reformer who would act aggressively to help Americans obtain affordable mortgages … and be able to keep their homes. I sought a consensus-builder who’s earned the respect of Republicans and Democrats, who can get things done.”
Preston was confirmed by the U.S. Senate by unanimous consent on June 5 and sworn in the same day.
During his tenure, the federal government implemented some of the most sweeping and controversial changes to housing and financial policy since the Great Depression, including: the Housing and Economic Recovery Act of 2008; the Economic Stabilization Act of 2008; the Troubled Asset Relief Program; government takeovers of Fannie Mae and Freddie Mac; and expanded FHA refinancing.
Though he emphasized the importance of government action in crisis by saying “mortgage markets have remained open almost entirely due to government support,” Preston said the private sector should ultimately restore the housing market. He argued too many homeowners who should be getting help were still falling through the cracks, and urged financial institutions to “be bold” in their actions to assist troubled homeowners. Preston warned Congress and state attorneys general would continue to intervene if private financial institutions didn’t act strongly enough, specifically citing a congressional plan to allow bankruptcy judges to modify mortgages.
In responding to criticisms that few financial institutions had enrolled in the Hope for Homeowners program, the cornerstone of the 2008 housing bill, Preston said the program was too expensive and complex for borrowers and lenders to use.
While at HUD, Preston continued to be an outspoken advocate for transparency, effectiveness, and efficiency in government programs. He initiated reforms to enable the Federal Housing Administration to handle its increasing volume of loans; broke ground on two public housing developments in New Orleans that had been stalled due to lack of funding; and finalized regulations that had been stalled since 2002 to help consumers find lower costs mortgages and avoid harmful loan offers.
Preston continues to be an active commentator on the housing market and the mortgage crisis. In an October 2010 appearance on CNBC Preston laid out a path forward, noting, “[W]e’ve got a situation right now where, you know, the federal government’s basically doing all the mortgages. The Fed owns over a trillion dollars worth of mortgage securities. We don’t know what that’s going to look like going forward. … I think it’s absolutely essential that we get on with the task of laying out a path toward a private mortgage finance system in our country.” Preston also discussed the causes of, and solutions for, the housing crisis in an April 2011 interview with World magazine.
In November 2010, Oakleaf introduced “Intelligent Waste Management,” a new approach to waste management the company claims will help its clients reduce “the financial and environmental costs” associated with their waste products. The process, Oakleaf says, transforms waste “into an asset,” increasing clients’ reputations for sustainability while enhancing productivity. The approach differs from traditional waste management services in four ways, the company explains. First, each client receives a business solution tailored to its needs and industry. Next, Oakleaf minimizes costs to the client by procuring goods and services from local vendors. Third, the company minimizes the waste dumped into costly landfills by extracting commodities from the client’s waste stream. Finally, Oakleaf created a new analytical tool and a 24-hour, seven-day-a-week customer service center to implement and track the progress of the news system, and to help educate clients about the new process.
Preston discussed the company’s new approach when he co-hosted CNBC’s morning show “Squawk Box” on Dec. 22, 2011. The company has also created a blog to update customers on the benefits of the program, and the company’s sustainability efforts in general.
The company provides its services to more than 83,000 locations throughout the U.S. and has been named five times to Inc. magazine’s list of the fastest growing, privately held companies in the U.S. The company earned nearly $595 million in revenues in 2008 and was number 35 on Inc.’s list in terms of gross dollars of growth. In May 2010, for the sixth consecutive year, Oakleaf was named one of the top 100 fastest growing inner-city companies in the U.S. by the Initiative for a Competitive Inner City.
Shortly after taking over Oakleaf, Preston established Oakleaf Cares, an effort to increase the company’s involvement in its community. In addition to organizing volunteers to serve in soup kitchens and local tutoring program, Preston led a team for the 2011 Multiple Sclerosis bike ride in Windsor, Connecticut. Team Oakleaf had more than 100 participants.
In January, 2011 Oakleaf moved to its new headquarters in Windsor, Connecticut.
United States Secretary of Housing and Urban Development
The United States Secretary of Housing and Urban Development is the head of the United States Department of Housing and Urban Development, a member of the President's Cabinet, and thirteenth in the Presidential line of succession. The post was created with the formation of the Department of Housing...
of the U.S. Department of Housing and Urban Development from 2008 to 2009 and the 22nd Administrator of the U.S. Small Business Administration
Small Business Administration
The Small Business Administration is a United States government agency that provides support to entrepreneurs and small businesses. The mission of the Small Business Administration is "to maintain and strengthen the nation's economy by enabling the establishment and viability of small businesses...
from 2006 until his appointment as HUD Secretary. Before entering public service, Preston spent nearly 25 years in financial and operational leadership positions in the private sector.
Early life and business career
Preston grew up in JanesvilleJanesville, Wisconsin
Janesville is a city in southern Wisconsin, United States. It is the county seat of Rock County and the principal municipality of the Janesville, Wisconsin Metropolitan Statistical Area. As of the 2010 census, the city had a population of 62,998.-History:...
, Wisconsin
Wisconsin
Wisconsin is a U.S. state located in the north-central United States and is part of the Midwest. It is bordered by Minnesota to the west, Iowa to the southwest, Illinois to the south, Lake Michigan to the east, Michigan to the northeast, and Lake Superior to the north. Wisconsin's capital is...
and attended Parker High School
George S. Parker High School
George S. Parker High School is a comprehensive public secondary school located on the west side of the city of Janesville, Wisconsin. The school, named for George S. Parker, founder of the Parker Pen Company, was constructed in 1967. The rival east side school is Joseph A. Craig High School. Dr...
where he was class valedictorian
Valedictorian
Valedictorian is an academic title conferred upon the student who delivers the closing or farewell statement at a graduation ceremony. Usually, the valedictorian is the highest ranked student among those graduating from an educational institution...
, president of the student congress, and a varsity wrestler. His mother grew up in Germany during and after World War II and his father was born in an Appalachian coal-mining camp. Preston has four siblings.
Preston earned a B.A.
Bachelor of Arts
A Bachelor of Arts , from the Latin artium baccalaureus, is a bachelor's degree awarded for an undergraduate course or program in either the liberal arts, the sciences, or both...
with Highest Distinction in political science
Political science
Political Science is a social science discipline concerned with the study of the state, government and politics. Aristotle defined it as the study of the state. It deals extensively with the theory and practice of politics, and the analysis of political systems and political behavior...
from Northwestern University
Northwestern University
Northwestern University is a private research university in Evanston and Chicago, Illinois, USA. Northwestern has eleven undergraduate, graduate, and professional schools offering 124 undergraduate degrees and 145 graduate and professional degrees....
in 1982 and an MBA from the University of Chicago Graduate School of Business in 1985.
During the first half of his private sector career, Preston worked in investment banking and corporate finance. Preston joined Lehman Brothers
Lehman Brothers
Lehman Brothers Holdings Inc. was a global financial services firm. Before declaring bankruptcy in 2008, Lehman was the fourth largest investment bank in the USA , doing business in investment banking, equity and fixed-income sales and trading Lehman Brothers Holdings Inc. (former NYSE ticker...
in 1985, ultimately serving as a Senior Vice President in the Investment Banking Department.
In 1993, Preston moved to First Data Corporation where he was Senior Vice President and Treasurer. He managed capital structure strategies, financial risk management, and investor relations during a period of rapid growth.
Preston moved to The ServiceMaster Company
ServiceMaster
ServiceMaster is a privately held Fortune 500 company that provides various services to residences and firms. Its headquarters are located in Memphis, Tennessee after moving there from Downers Grove, Illinois in early 2007. Brands operated by ServiceMaster include: TruGreen, Terminix, American...
in 1997 where he served as Executive Vice President and Chief Financial Officer for seven years before heading the company’s Strategic Services effort. In 2000 CFO magazine named him one of the “Next Wave” of financial executives that would make a difference in the next decade.
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.”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 attempted 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. By correcting erroneous data, the federal government was required to reduce its previously reported small business procurements by $4.6 billion, causing total contracts to fall below the 23 percent congressional mandate. Some small business advocates did not think Preston’s reforms went far enough. House Small Business Committee Chairwoman Nydia Velazquez (D-NY) said, “The fact that large businesses are being awarded with small-business contracts, and that there is no system in place with penalties or consequences for this, is extremely concerning.”
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.”
Secretary of Housing and Urban Development
As his predecessor departed amidst scandal, housing advocates and Senate Banking, Housing, and Urban Affairs Committee chairman Chris Dodd (D-CT) criticized Preston for his lack of previous housing policy experience. With the housing crisis unfolding, President Bush said he needed someone with Preston’s background in finance: “I looked for a leader with an impressive background in finance; someone who understands the important role the housing market plays in the broader economy. I sought a reformer who would act aggressively to help Americans obtain affordable mortgages … and be able to keep their homes. I sought a consensus-builder who’s earned the respect of Republicans and Democrats, who can get things done.”
Preston was confirmed by the U.S. Senate by unanimous consent on June 5 and sworn in the same day.
During his tenure, the federal government implemented some of the most sweeping and controversial changes to housing and financial policy since the Great Depression, including: the Housing and Economic Recovery Act of 2008; the Economic Stabilization Act of 2008; the Troubled Asset Relief Program; government takeovers of Fannie Mae and Freddie Mac; and expanded FHA refinancing.
Though he emphasized the importance of government action in crisis by saying “mortgage markets have remained open almost entirely due to government support,” Preston said the private sector should ultimately restore the housing market. He argued too many homeowners who should be getting help were still falling through the cracks, and urged financial institutions to “be bold” in their actions to assist troubled homeowners. Preston warned Congress and state attorneys general would continue to intervene if private financial institutions didn’t act strongly enough, specifically citing a congressional plan to allow bankruptcy judges to modify mortgages.
In responding to criticisms that few financial institutions had enrolled in the Hope for Homeowners program, the cornerstone of the 2008 housing bill, Preston said the program was too expensive and complex for borrowers and lenders to use.
While at HUD, Preston continued to be an outspoken advocate for transparency, effectiveness, and efficiency in government programs. He initiated reforms to enable the Federal Housing Administration to handle its increasing volume of loans; broke ground on two public housing developments in New Orleans that had been stalled due to lack of funding; and finalized regulations that had been stalled since 2002 to help consumers find lower costs mortgages and avoid harmful loan offers.
Preston continues to be an active commentator on the housing market and the mortgage crisis. In an October 2010 appearance on CNBC Preston laid out a path forward, noting, “[W]e’ve got a situation right now where, you know, the federal government’s basically doing all the mortgages. The Fed owns over a trillion dollars worth of mortgage securities. We don’t know what that’s going to look like going forward. … I think it’s absolutely essential that we get on with the task of laying out a path toward a private mortgage finance system in our country.” Preston also discussed the causes of, and solutions for, the housing crisis in an April 2011 interview with World magazine.
Post-Administration work
Preston was named President and CEO of Oakleaf Waste Management in August 2009. Oakleaf, the nation’s largest company dedicated to providing outsourced waste and recycling services, counts some of the U.S.’s most prominent companies, including Sears/Kmart, PepsiCo, and CVS, as its clients.In November 2010, Oakleaf introduced “Intelligent Waste Management,” a new approach to waste management the company claims will help its clients reduce “the financial and environmental costs” associated with their waste products. The process, Oakleaf says, transforms waste “into an asset,” increasing clients’ reputations for sustainability while enhancing productivity. The approach differs from traditional waste management services in four ways, the company explains. First, each client receives a business solution tailored to its needs and industry. Next, Oakleaf minimizes costs to the client by procuring goods and services from local vendors. Third, the company minimizes the waste dumped into costly landfills by extracting commodities from the client’s waste stream. Finally, Oakleaf created a new analytical tool and a 24-hour, seven-day-a-week customer service center to implement and track the progress of the news system, and to help educate clients about the new process.
Preston discussed the company’s new approach when he co-hosted CNBC’s morning show “Squawk Box” on Dec. 22, 2011. The company has also created a blog to update customers on the benefits of the program, and the company’s sustainability efforts in general.
The company provides its services to more than 83,000 locations throughout the U.S. and has been named five times to Inc. magazine’s list of the fastest growing, privately held companies in the U.S. The company earned nearly $595 million in revenues in 2008 and was number 35 on Inc.’s list in terms of gross dollars of growth. In May 2010, for the sixth consecutive year, Oakleaf was named one of the top 100 fastest growing inner-city companies in the U.S. by the Initiative for a Competitive Inner City.
Shortly after taking over Oakleaf, Preston established Oakleaf Cares, an effort to increase the company’s involvement in its community. In addition to organizing volunteers to serve in soup kitchens and local tutoring program, Preston led a team for the 2011 Multiple Sclerosis bike ride in Windsor, Connecticut. Team Oakleaf had more than 100 participants.
In January, 2011 Oakleaf moved to its new headquarters in Windsor, Connecticut.