Government Contracts Monitor

Maria Contreras-Sweet Sworn-In as New SBA Head

April 23, 2014

On April 7, 2014, Maria Contreras-Sweet was sworn-in and assumed her new position as the 24^th Administrator of the U.S. Small Business Administration (SBA). Commenting on her Senate confirmation, President Obama stated that, in Contreras-Sweet, “the American people will have a fierce champion who understands what it means to start a small business and who has a proven track record of helping other small businesses succeed.” The President noted that two years ago he elevated the role of SBA Administrator to a cabinet-level position “to make sure that small businesses have the seat at the table they deserve.” He stated that Contreras-Sweet “will be charged with looking for more ways to support small businesses.”

Contreras-Smith has a strong background as a successful entrepreneur and business executive, as well as in state government, and has worked in both the political and corporate world to support women, Latinos and small business. Most notably, she served as Secretary of the California Business, Transportation and Housing Agency (BTHA). In such capacity, she oversaw 42,000 employees, a $14 billion budget and 13 state departments, including the Department of Financial Institutions, Caltrans, the California Highway Patrol and the Department of Motor Vehicles. After leaving public office, she formed a private venture capital firm that invests in small businesses, and she founded ProAmérica Bank, which specializes in commercial loans and helping small- and medium- sized businesses, especially in the Latino community. She has also served on the Federal Glass Ceiling Commission, which published several reports on the effect of the Glass ceiling on women and minorities in the workplace. Her full biography can be found here.

Contreras-Sweet thus brings a wide range of experience, including a strong background in business lending, to her new position, where she will face many challenges These challenges include (1) establishing a new sense of direction at SBA after months of interim leadership since former Administrator Karen Mills announced her intended departure more than 13 months ago and then left last August, (2) undertaking the new missions and responsibilities hinted at by President Obama and being contemplated by Congress, (3) operating with reduced funding, and (4) addressing Congressional concerns that SBA has been wasting money and neglecting core responsibilities. While these challenges would be daunting under any circumstances, they are particularly so in today’s environment where the economy, and particularly small businesses, are still struggling to obtain the credit and money needed to finance and grow their businesses, as well as deal with the increasing burden of government regulation and new programs.

All of this is particularly so in the Government contracting area, where overall Government spending is shrinking and the Government is heavily promoting cost-saving procurement methodologies, such as strategic sourcing and consolidating requirements (bundling), that greatly reduce opportunities for the current broad number of small businesses. Reduced opportunities also mean intensified price competition, shrinking profit margins, increased protests of all kinds (including both SBA size and procurement bid protests) and increased pricing and other business risks, all of which are particularly impactful on small businesses. It also means increasing tensions between the various small business communities that SBA is tasked to promote, who increasingly are at each other’s throats and trying to get a leg up in the intensifying competition for the shrinking available work. At the same time, there is increasing oversight and scrutiny on all sides, including from SBA, with the inevitable associated additional costs and other burdens.

All of these factors impact not only SBA’s various small business constituencies, but also SBA itself, which today is overtasked in trying to deal with all these issues, with reduced funding. We welcome Contreras-Sweet, and wish her the very best of luck as she begins to tackle these challenges and fulfill her promise, during her confirmation hearing, “to make the U.S. Small Business Administration an even more significant force in expanding the opportunities for all Americans and ensuring the economic strength of our country and the global economy.” Click here to read her statement.

Hopewell Darneille is the attorney responsible for the content of this article.