Foreach to save value

IMHO you're going about this all wrong.  You're doing 2 duplicated queries just to get the first names and the last names of the user selections; really you should do the users query *just once* and keep it in an array variable, then simply generate your dropdown ChoiceLabels based on the properties naturally contained in that array.  This is much simpler and much more flexible.

Here is how I would re-write the above, with some of the original code included (and commented out) for comparison:

a!localVariables(
  
  /*local!fn: {*/
    /*index(*/
      /*rule!PTS_QueryUsers(local!selectedDept),*/
      /*"firstName",*/
      /*{}*/
    /*)*/
  /*},*/
  /*local!ls: {*/
    /*index(*/
      /*rule!PTS_QueryUsers(local!selectedDept),*/
      /*"lastName",*/
      /*{}*/
    /*)*/
  /*},*/

  /*local!user: if(*/
    /*isnull(local!selectedDept),*/
    /*{},*/
    /*union(*/
      /*apply(*/
        /*fn!concatenate,*/
        /*merge(local!fn, local!ls)*/
      /*),*/
      /*apply(*/
        /*fn!concatenate,*/
        /*merge(local!fn, local!ls)*/
      /*)*/
    /*)*/
  /*),*/
  
  local!selectedUser: null(),
  
  local!userSelections: if(
    isnull(local!selectedDept),
    {},
    rule!PTS_QueryUsers(local!selectedDept)
  ),
  
  local!selectedUserEmail: if(
    isnull(local!selectedUser),
    null(),
    local!selectedUser.firstName & "." & local!selectedUser.lastName & "@gmail.com" /* or whatever your logic is */
  ),
  
  a!dropdownField(
    label: "Assigned Name",
    labelPosition: "ADJACENT",
    placeHolder: "Select User",
    choiceLabels: a!forEach(
      items: local!userSelections,
      expression: fv!item.firstName & " " & fv!item.lastName
    ),
    choiceValues: local!userSelections,
    value: local!selectedUser,
    saveInto: local!selectedUser,
    required: true,
    disabled: isnull(local!selectedDept)
  )
  
)