COALITION OF DALLAS PUBLIC SAFETY EMPLOYEE ASSOCIATIONS

RESOLUTION

WHEREAS, the City Council of the City of Dallas approved a Resolution on January 25,
2017 that: (1) made false or misleading accusations regarding risky investments. While
these risky investments were made, they were not made within the last two years,
making this assertion outdated and therefore meaningless; (2) made accusations of
borrowing to make investments instead of only investing surplus as required by law.
This assertion, again, is questionable during any period, but has not taken place
within the last two years, making this assertion outdated and therefore meaningless;
(3) accuses trustees of engaging in extensive, expensive, and unnecessary travel around
the world by board members for the ostensible purpose of inspecting investments.
Board travel policies do not allow for this and all travel by Board members is
approved and must meet certain generally accepted criteria. Board members have
not participated in any so-called extensive and/or unnecessary travel within the last
two years therefore making this assertion meaningless; (4) accuses the System of
authorizing excessive disbursements to pensioners from DROP accounts even when the
amount of such disbursements impaired the Dallas Police & Fire Pension Systems ability
to pay retirement, disability, and survivor pension benefits. When a pension system is
insolvent, ALL disbursements impair the pension systems ability to survive. DROP
accounts are accrued benefits that were delayed by members and therefore do not
take a subordinate position to other disbursements. One of the five Fiduciary
Obligations is the Duty to Comply with Plan Documents. Our current plan
document does not allow for DROP funds to be withheld in any subordinate manner;
(5) accuses the System of considering the sale of assets to resume DROP disbursements
even after temporarily deferring them under a judicial order. The judicial order
obligated the Board to act in accordance with the order and is irrelevant to this
issue once the order was lifted. Yes, asset liquidation was considered and
implemented in order to have the liquidity necessary to pay ALL benefits. The
Pension Systems Plan Document does not currently allow for any other outcome;
(6) accuses the System of authorizing additional millions of dollars in response to cash
calls from investment enterprises even when such disbursements also impair the Dallas
Police & Fire Pension Systems ability to pay retirement, disability, and survivor benefits.
Due to imminent insolvency, any and all funds disbursed impair the Systems ability
to pay benefits. Only after extensive costs versus benefits analysis concerning
these contractual obligations did the System pay these funds. (7) accuses the
System of allowing the system and undisclosed investments to be run by current and
former employees who are not fiduciaries of the system. This is not an uncommon
practice within pension systems. Boards are the primary fiduciaries, set policies,
and govern the plan. If the Executive Director or other staff members were
fiduciaries, they could very well be conflicted if the Board gave direction to make
investments into something for which they do not believe; (8) accuses the System of
making board decisions without properly posting agendas that adequately describe items
to be discussed or actions to be considered, as required by law. The City is hereby
challenged to produce evidence of this occurring, especially within the last two
years; (9) accuses the System of incurring wasteful, uncontrolled, and high administrative
expenses. The City is hereby challenged to produce evidence of this occurring,
especially within the last two years.

WHEREAS, the Dallas City Council accuses the Dallas Police & Fire Pension System of
"practices, including overstating asset values, misclassifying risky investments to make
them appear safer and to make the system's investments appear more diversified,
entering into opaque investment agreements, and failing to post sufficiently informative
agenda items, as required by law, are among the many methods that the System has used
to evade state and city oversight that would have prevented many, if not all, of the
enumerated improper practices and the current dire financial condition". - The City had
council representation on the Board during the entire period that is represented
here. With this being the case, the City is implicating itself as being complicit in
this activity, nevertheless, these actions, if they took place at all, were done more
than two years ago and are currently outdated and meaningless.

WHEREAS, the Dallas City Council accuses that the Pension System "has gone to the
lengths of hiring a private investigator to conduct a forensic trace on a councilmember
trustee who publicly opposed the System's irresponsible steps and clandestine practices".
- While there is evidence that such activity did occur, there is no evidence that it
was done with the knowledge of any current Board members and it occurred more
than two years ago and is therefore outdated and meaningless.

WHEREAS, the Dallas City Council indicates that Article 6243a-1 "provides no meaningful
standards or safeguards, and therefore the funds supposedly held in trust by the system
must be protected by a duly appointed and authorized fiduciary operating under court
supervision". - This is an indictment of the state legislature and the Dallas Police and
Fire Pension System. This audacious statement is nothing more than a fictitious
framework for the City to seek legal means to take over the fund. Even if these
assertions were based on facts, the Dallas City Council had an opportunity to opt-
out of the provisions of Article 6243a-1 when it was adopted so the Council should
be blaming no one but themselves.

WHEREAS, the Dallas City Council is asserting that "several past and current System
board members appear to have direct personal financial interests, including sizable
balances under the System's Deferred Retirement Option Plan (DROP) program, creating
material conflicts between their personal financial interests and the interests of the System
and its members, pensioners, and beneficiaries, but they have consistently failed to rescue
themselves from board decisions and instead have deliberated and voted on matters
subject to those conflicts, and appear determined to continue this practice, and therefore
the System and members and pensioners must be protected by a disinterested and loyal
fiduciary". - This is an indictment of all service trustees with DROP accounts in an
attempt to tarnish their reputation, their character, and their ability to fulfil their
fiduciary responsibilities. Every financial matter that comes before the Board has an
effect on service trustees in some form so this argument, as it pertains to DROP
accounts is unfounded.

WHEREAS, the Dallas City Council asserts "some of the persons who administer Article
6243a-1 apparently interpret it to limit or eliminate the city's powers to protect the financial
security of its valued first responders, retired first responders, and their families and
survivors". - This is an ambiguous statement that has no relevance. The Board is the
governing body of this pension fund and is subject to the rules of a plan document.
The City has always had representation on the Board but has done little if anything
at all to assert its "powers to protect the financial security" of fund members.

WHEREAS, the Dallas City Council asserts "the System's board has administered plan
assets in a manner that impairs the system's ability to achieve its primary fiduciary purpose
of paying retirement, disability, and survivor pension benefits". - The Pension Board has
conducted its activities consistent with its governing plan document. The Dallas
City Council is hereby challenged to show otherwise.

WHEREAS, the Dallas City Council asserts "Article 6243a-1's lack of limits, checks, and
balances on the powers of the pension system board and plan members make it difficult
or impossible for the state or the city to obtain necessary records and information needed
for adequate oversight of the System, and permitted the System for years to overstate
asset values to conceal its deteriorating financial condition from the city, the state, and its
own members, directly causing the current emergency situation". - This is an erroneous
indictment of the state legislature and it is not based on facts. The System had
independent professional auditors that did not serve the System well as it pertains
to asset values. That situation has been rectified as asset values are now appraised
regularly and are stated correctly. Since this prior disservice occurred over two
years ago, this accusation is currently meaningless.

WHEREAS, the Dallas City Council asserts "because of the above deficiencies in Article
6243a-1, the Dallas Police & Fire Pension System has escaped any meaningful
governance supervision, leading to incurrence of obligations far in excess of assets,
increased benefits and features such as shockingly generous DROP returns, without the
ability to honor those commitments, and materially diminished morale, security, and
retention among important first responders who participate in plans administered by the
Dallas Police & Fire Pension System". - This is an erroneous indictment of the state
legislature and is not based on facts. Even if these assertions were based on facts,
the Dallas City Council had an opportunity to opt-out of the provisions of Article
6243a-1 when it was adopted so the Council should be blaming no one but
themselves.

WHEREAS, the Dallas City Council asserts "the city has insufficient tools under Article
6243a-1 to enable the city to protect the System's pensioners' retirement, disability, and
survivor pension benefits while maintaining its own fiscal health and the safety of its
residents". - This is an erroneous statement. The City has the ability, and is
exercising that ability to present a bill to the state legislature that can provide the
tools for which they seek and the Dallas City Council had an opportunity to opt-out
of the provisions of Article 6243a-1 when it was adopted

WHEREAS, the Dallas City Council asserts "this situation has created a crisis posing an
imminent and substantial threat to the fiscal health and public safety of the city". - This is
an accurate statement; however, city leadership could have helped alleviate some of
the concerns of members which spurred the retired members to ask for lump-sum
withdrawals from their DROP accounts. By not doing so, this city leadership bears
a significant amount of culpability for our current situation.

WHEREAS, the Dallas City Council asserts "the System board, if it validly exists, is
constitutionally and statutorily required to hold assets of the system in trust but has
inexplicably abandoned its fiduciary obligations, as evidenced by, among other things, the
board's stated intent to liquidate assets to resume uncontrolled DROP disbursements even
while leaving underfunded its ability to pay retirement, disability, and survivor pensions". -
This statement is inexplicably false. The Board has a fiduciary duty to follow the
plan document. Due to liquidity constraints, future DROP disbursements would not
be "uncontrolled" as stated. DROP disbursements do not have a subordinate
position to other benefits as indicated by the Council.

WHEREAS, the Dallas City Council asserts "this situation as [sic] created an emergency
substantially threatening the financial security of valued and courageous first responders
who participate in pension plans created based on Article 6342a-1, as well as the financial
security of their families". - Our current situation has nothing to do with Article 6243a-
1. Egregious mistakes were made by the fund in terms of investments as well as
the structure of the plan itself. The City Council had representation on the Board
during this period but in many cases failed to make board meetings. Proposals are
being put forth to correct structural problems in the plan as well as provide
additional checks and balances to investments through additional professional
oversight.

WHEREAS, the Dallas City Council asserts "this emergency requires substantially
increased control and oversight of the System". - This statement is absolutely false.
The current Board is operating within the confines of fiduciary responsibility as well
as within the confines of what the plan document allows. This statement is
tantamount to a power grab by the City and nothing more.

WHEREAS, the Dallas City Council asserts "absent extraordinary measures, the Dallas
Police & Fire Pension System will soon run out of sufficient funds to pay retirement,
disability, and survivor pension benefits". - This is hardly a new revelation. The pension
system has worked tirelessly with the City to produce a viable solution to this dire
situation. What is needed here is good-faith communications and efforts from both
parties and not an attempt to power grab as evidenced by the council's resolution.

WHEREAS, the Dallas City Council asserts "the city's extensive and intensive efforts to
negotiate agreed plan amendments and joint proposals to be considered by the
Legislature to alleviate this emergency have been rejected by the System". - This
statement in an egregious lie. The pension system has made concession after
concession to try to come to an agreement and on more than one occasion came
very close to working out a deal, only to be met with additional requirements by the
City. By these actions, the City is indicating that it does not want an agreed upon
deal but rather a power grab as evidenced by the council's resolution.

WHEREAS, the Dallas City Council asserts "until there are statutory changes that provide
adequate governance tools to the city and/or financial support, the only remaining feasible
method of meeting this emergency and of effectively supporting and protecting, for the
near and long term, the Dallas Police & Fire Pension System, is extraordinary judicial
action including, for example, receivership, declaratory relief, mandamus, and injunction". -
This statement says it all that the City Council will be pursuing control of the
pension system without any justifiable reasons to do so. Yes, they have laid out
trumped-up arguments to do so but they are substantially weak and without merit.
The City Council is hereby challenged to produce any evidence that shows that
trustees acted outside of their fiduciary responsibility during the last two years.

WHEREAS, the Dallas City Council asserts "the public interest, the city's interest, and
fundamental fairness requires that the city indemnify and reimburse any and all such
councilmembers who take such actions for their consequential expenses, and defend and
indemnify them from any liability arising from such actions, and such indemnity,
reimbursement, and defense will serve a public purpose...". - As a result of the unlawful
power grab, the Dallas City Council will indemnify and reimburse council trustees
for taking legal action to do so.

WHEREAS, this is a despicable action and if legal action is taken against the current
Pension System by council trustees, there will be consequences; Now, Therefore,

BE IT RESOLVED BY THE COALITION OF DALLAS PUBLIC SAFETY EMPLOYEE

ORGANIZATIONS:

That if any member of the Dallas City Council who is also a member of the Dallas
Police & Fire Pension System take legal action against the System, ALL council
members who are trustees of the Dallas Police & Fire Pension System will receive a
lifetime ban from support from all member organizations of this coalition.
Furthermore, members of this coalition will actively support your opponents when
applicable. This ban includes city, county, state, and national elections.
APPROVED AS TO FORM:

______________________________ ______________________________
Michael Mata, President James McDade, President
Dallas Police Association Dallas Fire Fighters Association

______________________________ _______________________________
Michael Walton, President Joseph Martinez, President
Fraternal Order of Police Dallas Hispanic Fire Fighters Association

______________________________ ______________________________
Thomas Glover, President Marcus Armstrong, President
Black Police Association Black Fire Fighters Association

______________________________ ______________________________
George Aranda, President Don Howard, President
National Latino Law Enforcement Dallas Retired Fire Fighters Association
Organization

______________________________ ______________________________
Pete Bailey, President Lingburge Williams, President
Dallas Retired Police Officer Black Fire Fighters Retiree Association
Association of Dallas

______________________________
Ed Davis, President
Dallas Retired Hispanic Fire Fighters
Association