When Dorothy Lueking, 74, was in high school in south Los Angeles, her government teacher said it was good to work for the government because of the benefits.  
But after 35 years of county service, Lueking's monthly pension is just $922, which includes a subsidy aimed at helping with health care costs.
Come November, that subsidy expires, and she'll be down to $705 a month.
That's a loss of about 24 percent of her income.
"We're going to have to stop going to Staters twice a week and go once a week instead," Lueking said of herself and her husband, Ted, who live in Bloomington. "We'll make a loaf of bread last."
For as long as the extra money - called the general subsidy - has been paid, the

Bloomington resident and retired San Bernardino County employee Dorothy Lueking will lose 24 percent of her pension income after a special benefits program is cut. (Al Cuizon/Staff Photographer, Inland Daily Bulletin)
retirement board has cautioned retirees that it's an extra benefit, not an entitlement, and that it could be canceled at some point.  
That point came March 7, when the county retirement board voted to end the subsidy.
But Lueking said that while she and many of the more than 7,000 retirees who receive it knew there was a possibility the subsidy might one day end, they nevertheless assumed the money would be paid out until at least 2013.
In many cases, like her own, she said the money has been a necessity, not a luxury.
"It doesn't do much good to caution people who need the money," she said. "What are you going to do? There's no emergency savings in that situation."
Lueking said it's human nature.
"You can tell a person they're not going to get something, but if you give it to them they're going to think they're going to get it forever."
Indeed, just as Lueking and other retirees assumed the general subsidy would last, there was a time when the county retirement board seemed to think the same and that the general pension fund would always make money - that the good times would never end.
Good times keep rolling
Money for the subsidy came from "excess earnings" - investment profits beyond the pension board's goal. And when the subsidy was created in 1996, thanks to a seemingly invincible stock market, county pension officials thought those excess earnings would continue ad infinitum.
In a December 1999 newsletter, pension board member George Kaenel wrote that there was enough money in the subsidy fund "to continue the subsidy at the current level for everyone who is currently retired and everyone currently employed for the rest of their lives."
County CEO Greg Devereaux, who supported ending the subsidy, said the county retirement board - the San Bernardino County Employees' Retirement Association, or SBCERA - wasn't the only agency that thought the prosperity would never end. In the late 1990s, he said the California Public Employees Retirement System was encouraging cities to boost their pension plans, saying the cost would stay low.
"They were saying, `You're super-funded and you may never have to pay again,"' Devereaux said. "That was the whole (Cal)PERS pitch."
In 1999, CalPERS sponsored a bill that would increase pension benefits for state employees.
An analysis of that legislation, S.B. 400, said, "CalPERS intends to fund the enhanced benefits provided by this bill through ... assets the system has generated over the past several years, due to the superior performance of the stock market."
The analysis also said CalPERS would offset cost increases "through continued excess returns of the CalPERS fund."
Between 1996 and 2000, the retirement board set aside about $142 million in excess earnings to pay for the general subsidy, according to an SBCERA estimate.
Paying off the good years
Retirees weren't the only ones benefiting. Between 1996 and 2001, the retirement board told San Bernardino County it didn't have to pay $210.5 million it owed to the retirement system.
Following the recent financial crisis, which led to a loss of billions for the pension fund, those breaks are costing the pension system and the county, said county Treasurer-Tax Collector Larry Walker.
"The county gets a holiday in a good year, and it pays it back in a bad year," Walker said. "It's the holidays in good years that the county is paying off now."
The county pays a certain percentage of employees' pay into the retirement system each year. In 2001, the pension board said the county owed nothing for most employees and only 2.29percent of pay for sheriff's deputies and firefighters.
Starting in July, the county will be asked to pay 14.7 percent for most employees and 31.2 percent for sheriff's deputies and firefighters. Pension costs for the county are expected to rise by $72 million over the next five years.
That's why Walker and others supported eliminating the general subsidy and taking what's left of the general subsidy account - about $40.6 million when the subsidy expires this fall - to offset the county's pension costs over the next 20 years.
The pension board voted 5-4 on March 7 to eliminate the subsidy. Walker and the four board members appointed by the county Board of Supervisors - including one member appointed two days before the vote - voted in favor, while members representing current and retired employees voted against.
Retirees didn't ask the pension board to continue the subsidy forever, but rather to let the money in the account run out, which would have happened in 2013 or 2014.
"They talk about the harsh reality, but they could have put off that harsh reality until 2014," Lueking said.
"We may have to live hand to mouth in 2014, but let us have it until then. At least we'll have had it as long as we could get it."
Lueking said she had already been saving money, looking ahead to losing the subsidy in a few years. Losing the subsidy later this year will mean dipping into that savings sooner than she wanted to.
But for others, she said the loss of the subsidy will create hard choices: food or medicine, dental care or glasses.
Lueking read a letter from a fellow retiree who said she had been working to pay off debts by 2014.

"Now that they've cut this off," Lueking said, "she won't make it."