b'LOS ANGELES FIRE AND POLICE PENSION SYSTEM NOTES TO FINANCIAL STATEMENTS JUNE 30, 2024 AND 2023 NOTE 14COMMITMENTS AND CONTINGENCIESTermination RightsAll members who were active on or after July 1, 1982, have a vested right to their past contributions and accrued interest in the event of their termination prior to retirement, except Tier 4 members. The dollar amount of contributions and interest subject to this right were $2,095,693,051 and $2,102,036,289as of June 30, 2024 and 2023, respectively. The City Charter and the Administrative Code provide that member contributions as of June 30 and December 31 of each year earn interest at a rate based on investment earnings, exclusive of gains and losses on principal resulting from sales of securities.Investment CommitmentTheSystemhascommitmentstocontributecapitalforrealestateandalternativeinvestmentsinthe aggregateamountofapproximately$3,599,794,000and$3,097,744,000atJune30,2024and2023, respectively.Retiree Health Subsidy LitigationIn fiscal year 2023-2024, there were two cases before the courts that involved the retiree health insurance premium subsidy program that LAFPP administers (retiree medical subsidy).Both pending actions were brought by the Los Angeles Police Protective League against the Board and the City.The two cases (the LAPPL I Action and the LAPPL II Action) both seek to determine what retiree medical subsidy benefit the additional 2% salary contribution provides members who make the contribution under the unions and Citys 2011 Letter of Agreement (LOA).The union argues that the 2% contribution grants members the ceiling amount under Los Angeles Administrative Code (LAAC)4.1167, meaning either 7% or the medical trend rate for that year, whichever of the two is lower, with no discretion reserved to the LAFPP Board.The City argues that the 2% contribution gives members only the right to get out from under the 2011 Freeze Ordinance and participate in the process that existed under LAAC4.1154(e) prior to the 2011 Freeze Ordinance.Under the pre-Freeze Ordinance process, the LAFPP Board may exercise its discretion in setting the annual subsidy rate and can set it up to the maximum amount of 7% or the medical trend rate, whichever is lower.In the LAPPL I Action, on April 15, 2016, the plaintiffs agreed to dismiss LAFPP from the action in exchange for LAFPPs agreement to be bound by the final judgment rendered in the case. Until a court of competent jurisdiction renders a final judgement on the interpretation of the LOA, LAFPP has a fiduciary duty to follow LAAC4.1154(e) as written and its Board must continue to exercise its discretion in setting the retiree medical subsidy as it did before the 2011 Freeze Ordinance. The LAPPL Action I proceeded to trial, and on November 1, 2016, the trial court ruled in favor of the plaintiffs,findingthatthelanguageoftheLOAwasunambiguouswithoutweighingtheconflicting evidence regarding the interpretation of the LOA and the parties intent. The City appealed, and on October 30, 2018, the Second District Court of Appeal reversed and remanded the case for further proceedings consistent with the Court of Appeals decision. In its decision, the Court of Appeal found that the provisions at issue in the LOA were ambiguous, which required the trial court to consider and weigh the evidence of the parties intent in its interpretation of the provisions, which the trial court did not do.52 SECTION 2 Financials 69'