Public Comment

There are certain levels of corruption that folks get away with because the linkage is too tenuous… but in this case, the connection doesn’t seem to be all that tenuous. Laurie Capitelli, broker at Red Oak Realty and Berkeley City Council member (and our Tom Bates-anointed next mayor) claims to be retired, but apparently that didn’t stop him from pushing a deal through the city council that appears to have benefited himself personally.

Last time I looked council folk were supposed to recuse themselves from any legislation that personally benefited themselves. Usually they themselves don’t vote while getting all their pals to vote in their interest, but it seems Councilmember Capitelli didn’t think he needed a fig leaf to hide his nakedness on this transaction. When Berkeley Police Chief Michael Meehan needed a loan for his new home, he turned to our city council to pick up the bill and Councilmember Capitelli was only too willing to lead the charge… apparently Capitelli listed the property that Meehan wanted to purchase at the same time he voted in favor of the council subsidizing the chief’s loan!

That, of course, garnered Councilmember Capitelli (or at least the realty firm in which he’s a partner) a hefty fee, and guaranteed the deal would close. 

According to a news story that ran recently in the Contra Costa Times (too bad Berkeley no longer has its own daily newspaper): "This newspaper found that local Bay Area agencies provide housing assistance to 19 city managers, as well as police chiefs in Atherton, Berkeley and Richmond, San Rafael's fire chief, department heads in Sunnyvale, a government lawyer in San Mateo, a recreation director in Cupertino and others.” 

So did Laurie Capitelli profit from the City’s $500,000 loan to Police Chief Meehan? 

On November 10, 2009, Laurie Capitelli joined the rest of the Berkeley City Council in approving the appointment of Michael Meehan as the City’s new police chief, effective December 13, 2009. The resolution of approval authorized “a housing assistance loan of up to $500,000 for the purchase of a residence within the City of Berkeley”. 

In 2010 Chief Meehan and his family moved into a home in the Thousand Oaks neighborhood in north Berkeley and Meehan used the $500,000 loan from the City to purchase that property, which was sold on June 23, 2010 for $1,185,000. The listing agent was Anita Thede of Northbrae Properties; the buyer’s agent was Laurie Capitelli of Red Oak Realty. 

The website of the National Association of Realtors states that when it comes to commissions, “most areas have a standard percentage that agents expect to receive. This amount usually is 6 percent of the sales price, but you fill find agents who accept 5 percent and agents who ask for 7 percent.” The website also explains that every “real estate agent must work for a real estate broker”; that both the seller’s and buyer’s agent are paid by the broker for whom they work; and that “generally the agent and the broker split the commission that is paid to the seller’s and buyer’s broker upon the sale of the house.” Commonly, the listing broker shares the commission with the buyer’s broker, though the split is not always equal. 

Was Capitelli both the agent and the broker on this deal? 

If the commission on the Meehan house was 6 percent of the sales price, it would have been $71,100. If Northbrae and Red Oak split the commission equally, Red Oak would have received $35,550. Laurie Capitelli is [or was] a Red Oak Realty Partner. If Capitelli didn’t personally pocket the $35,550—or whatever Red Oak received—the business in which he is a principal did. 

Do Berkeley voters think this is how their elected representative (and especially their presumed next mayor) should use public office?