President Obama named Los Angeles businesswoman Maria Contreras-Sweet, the founder of a community bank and a former California Cabinet member, as his nominee to head the Small Business Administration.
Obama said Contreras-Sweet, who has worked with small businesses in the private sector, understands what small businesses need.
"Maria knows how hard it is to get started on a business," Obama said Wednesday. "The grueling hours, the stress, the occasional self-doubt."
"So not only did she start small businesses, but those have also been her customers, and she understands all too often that the lack of access to capital means a lack of opportunity," he said.
News of the nomination was well received by small business leaders, but some said it took far too long to fill the position, which has been vacant since Karen Mills stepped down in August to take a position at Harvard.
"Hopefully, upon confirmation, she will reach out and more actively engage with entrepreneurs and small-business organizations to listen to their ideas and concerns," Karen Kerrigan, chief executive of the Small Business and Entrepreneurship Council, said in an statement. She added that the SBA had "gone dark" in terms of outreach over the last year.
Contreras-Sweet's experience in the private sector includes her founding of Promerica, now called Proamerica Bank, which focuses on serving small and mid-sized businesses.
Gary Toebben, chief executive of the Los Angeles Area Chamber of Commerce, of which Contreras-Sweet is a member, said she has the right experience to help small businesses prosper.
"In her business as chair of Proamerica Bank she was in contact with numerous small businesses every day, businesses that have financial needs and need other kinds of advice," Toebben said. "That gives her a really hands-on understanding of the small business community and the challenges and opportunities they face."
Contreras-Sweet was also president and co-founder of Fortius Holdings, a private equity firm that provided capital to small California businesses.
As a member of the California Gov. Gray Davis' Cabinet — Contreras-Sweet was secretary of the California Department of Business, Transportation and Housing Agency from 1999 to 2003 — she oversaw a department of 40,000 employees that operated on a $12-billion budget.
Highlights of her tenure include setting up the state's first HMO regulatory agency, starting construction of the recently opened eastern span of the San Francisco-Oakland Bay Bridge and helping win voter approval of a $2.1-billion housing bond.
Allan Zaremberg, president of the California Chamber of Commerce, said Contreras-Sweet "has a lot of experience in both government and the private sector about what it takes to make a business succeed."
If confirmed by the Senate, Contreras-Sweet, 58, would fill the last position on Obama's second-term Cabinet.
Kerrigan said she hoped that Contreras-Sweet would speak with the president about the concerns of small-business owners with the new federal healthcare law, the state of the economy, regulatory overreach and access to capital.
Kerrigan added that the potential consolidation of the SBA with other federal agencies is a hot topic and that it will be interesting to learn Contreras-Sweet's stance on it.
"She will need to walk a tightrope with the small-business community on this issue if it is something the president pursues," Kerrigan said.
Contreras-Sweet hails from Guadalajara, Mexico, and immigrated to the United States when she was 5. She would be the second Latino on Obama's second-term Cabinet, which also includes Labor Secretary Thomas E. Perez. Latino business leaders applauded the nomination.
Javier Palomarez, chief executive of the U.S. Hispanic Chamber of Commerce, said in a news release that the nomination "clearly demonstrates that [Obama's] administration understands the needs facing America's small businesses, as well as the concerns of the nation's valuable minority-owned business community."
"Maria Contreras-Sweet is the epitome of a successful entrepreneur and social innovator, whose professional accomplishments make her the best and most qualified candidate to head the Small Business Administration," Palomarez said.
Contreras-Sweet is also the co-founder of Hispanics Organized for Political Equality, an organization that urges young Latinas to become involved in politics.
Proamerica Bank, where Contreras-Sweet chairs the board of directors, is the 12th smallest of the 65 banking institutions headquartered in Los Angeles County. With $123 million in deposits and $148 million in assets, it is larger than the other banks in the county that focus mainly on Latinos: Americas United Bank in Glendale and Pan American Bank in East Los Angeles.
Proamerica's A-list of backers included developer Ed Roski Jr., who built Staples Center and was a partner with Contreras-Sweet in a private equity firm; Solomon D. Trujillo, former chief executive of US West Communications Inc.; Norma Orci, co-founder of L.A. advertising firm La Agencia de Orci; and Henry G. Cisneros, former U.S. secretary of Housing and Urban Development.
The bank opened its doors in downtown Los Angeles in November 2006, with Contreras-Sweet saying her prospective customers were "acculturated and integrated" Latino owners of small businesses. "Now these families are ready to be part of the mainstream," she told The Times.
The mortgage meltdown and Great Recession hit hard. Proamerica struggled through losses of more than $11 million for six years before turning profits of $1 million in 2012 and $800,000 for the first nine months of 2013.