P'GC Pension Benefit Guaranty Corporation 

pmtenin~nmerisa~s ~~~~i~~~ 1200 K Street. N.w., Washington, D.C. 20005-4026 

Re: case 178287 

Connecticut Refining Company Pension Plan (the "Plan") 

The Appeals Board has reviewed your appeal of PBGC's 

September 5, 2002 determination that you are not entitled to a Top 

Heavy Plan benefit. For the reasons stated below, we are denying 

your appeal. 

Benefit Determination and Appeal 

In its September 5, 2002 determination (reissued November 12, 

2003), PBGC stated you are entitled to a $1,339.65 monthly benefit. 

In a December 5, 2003 letter, you noted that previous benefit 

calculations sent to you by PBGC included a Top Heavy Plan benefit 

of $2,770.53. You asked why PBGC's formal determination omitted the 

Top Heavy calculation. 

In a December 11, 2003 letter, PBGC explained that PBGC had 

determined you were a Key Employee and that a Key Employee was not 

entitled to the Plan's Top Heavy benefit. In your July 27, 2004 

appeal, you contended you did not fall under the Plan's definition 

of a Key Employee. 

Top Heavv Plan and Top Heavv Plan Benefit 

The Plan's actuarial firm (Pension Consultants of Farmington, 

Connecticut) determined the Plan was Top Heavy from January 1, 1984 

through December 31, 1993. PBGC accepted that determination. 

The Plan was amended and restated in a document effective 

January 1, 1984 (the "1984 Plan") and in a document effective 

January 1, 1989 (the "1989 Plan"). The 1989 Plan was in effect when 

you terminated employment on June 30, 1994. 

Section 5.1 of the 1989 Plan defines the Plan's regular 

Accrued Benefit. Section 5.2 of the 1989 Plan provides that a NonKey Employee is entitled to a Top Heavy Plan benefit ("minimum 
Accrued Benefit") . A Key Employee is entitled to the regular 

Accrued Benefit under Section 5.1, but not to the Top Heavy Plan 

benefit under Section 5.2. 

Ownershiw Interest in the Comuanv 

In a February 18, 2005 telephone conversation with the Board's 

staff, you said you had no ownership interest in the Company 

(Benzoline Energy Company F/K/A Connecticut Refining Company). Your 

claim is supported by the Plan's 1994 Actuarial Valuation Report 

("AVR") and by PBGC's audit (controlled group analysis). 

Definition of Kev Emulovee 

Section 1.32 of the 1989 Plan provided: 

"Key Employee" means an Employee as defined in Code 

Section 416(i) and the Regulations thereunder. Generally, 

any Employee or former Employee (as well as each of his 

Beneficiaries) is considered a Key Employee if he, at any 

time during the Plan Year [calendar year] that contains 

the "Determination Date" [in this case, the last day of 

the calendar year] or any of the preceding four (4) Plan 

Years, has been included in one of the followina 

cateaories [underlining added]: 

(a) an officer of the Employer (as that term is 

defined within the meaning of the Regulations under Code 

Section 416) having annual "415 Compensation" greater 

than 50 percent of the amount in effect under Code 

Section 415(b) (1) (A) for any such Plan Year. . . . 

[The remaining three categories do not apply to you since 

they involve different types or degrees of ownership 

interest in the Company.] 

The Key Employee definitions under the 1984 Plan and the 1989 

Plan differ with respect to the compensation threshold applicable 

to officers of the Employer, as described below: 

Section 1.23(a] of the 1984 Plan refers to an officer of 

the Employer whose annual Section 415 compensa.tion is 

"greater than 150 percent of the amount in effect under 

Code Section 415(c) (1) (A) for any such Plan Year." 

Section 1.32 (a) of the 1989 Plan refers to an officer of 

the Employer whose annual Section 415 compensation is 
"greater than 50 percent of the amount in effect under 

Code Section 415(b) (1) (A) for any such Plan Year." 

PBGC identified you as a Key Employee, because you were an 

officer of the Employer whose compensation exceeded the applicable 

compensation limits. Please note that PBGC did not consider you a 

member of any of the Key Employee categories involving an ownership 

interest in the Company. 

The Compensation Threshold 

From 1984 through 1988, your Plan Compensation exceeded the 

compensation threshold under Section 1.23(a) of the 1984 Plan. From 

1989 through 1993, your Plan Compensation exceeded the compensation 

threshold under Section 1.32 (a) of the 1989 Plan. Please see 

Attachment A. 

PBGC's compensation data is based on its audit of the Plan's 

records. Under the definitions in both the 1984 and 1989 Plan 

documents, your Plan Compensation was identical (or virtually 

identical) to your Section 415 Compensation. 

Depending on the Plan year in question, your Plan Compensation 

was two to four times greater than the corresponding compensation 

threshold. Therefore, we have concluded that your Section 415 

Compensation exceeded the applicable compensation limit in all Plan 

Years (calendar years) from 1984 through 1993. 

Officer of the Emplover 

Section 1.32 (a) of the 1989 Plan and Section 1.23(a) of the 

1984 Plan apply to an Employee who was an officer of the Employer 

(as that term is defined within the meaning of the Regulations 

under Code Section 416). 

In a February 18, 2005 telephone conversation with the Board's 

staff, you stated that your job title was Vice-president. You said 

you were hired by the owner (in June of 1983) as an efficiency 

expert to save the Company money by reviewing costs and other 

matters and making recommendations. You said that from 1990 to 1994 

you supervised, without authority to hire or fire, five or six 

division managers. You said your compensation included a salary and 

bonus, but you had no ownership interest in the Company or 

entitlement to its profits. 
The regulations under Code Section 416 provide: 

Whether an individual is an officer shall be 

determined upon the basis of all the facts, including, 

for example, the source of his authority, the term for 

which elected or appointed, and the nature and extent of 

his duties. Generally, the term officer means an 

administrative executive who is in regular and continued 

service. The term officer implies continuity of service 

and excludes those employed for a special and single 

transaction. An employee who merely has the title of an 

officer but not the authority of an officer is not 

considered an officer for purposes of the key employee 

test. Similarly, an employee who does not have the title 

of an officer but has the authority of an officer is an 

officer for purposes of the key employee test. . . . [26 

CFR 5 1.416-1, T-13.1 

PBGC's Benefit Statement shows you earned 11.0833 years of 

credited service from June 8, 1983 to June 30, 1994. Thus, the 

Board concluded you were in 'regular and continued service" and you 

were not employed for a "special or single transaction." 

The Plan's 1994 AVR identified you as an officer. You stated 

your job title was Vice-president. Thus, you clearly had the title 

of an officer. 

The Board notes that your February 18, 2005 statement that you 

acted without authority to hire and fire could be taken as a claim 

that you had the 'title of an officer, but not the authority of an 

officer." In reviewing this possibility, the Board took into 

consideration the following factors: 

. The Plan's 1994 AVR only identified two other individuals as 

officers of the Employer. 

You described your job as one which appears to have involved 

multiple and significant responsibilities, including the 

supervision of division managers. 

The Regulation does not single out hire/fire authority as an 

example of one of the facts to be used as a basis for 

determining whether an individual is an officer. Moreover, the 

Regulation does not state that an officers's authority to make 

a decision (such as a hire/fire decision) must be unilateral 

in nature. 
. You were a ~kustee of the Plan. ("The Connecticut Refining 

Company Pension Trust Agreement" was amended as of October 16, 

1985 to appoint you and three other individuals as Trustees of 

the Plan. ) 

. You were Director of the Company. ("A Consent to Corporate 

Action" signed on April 25, 1995 identifies you as one of the 

three Directors of the Company.) 

. You acted in the capacity of Plan Administrator. (PBGC's 

June 10, 1999 Termination and Trusteeship Memorandum 

identifies you as a former officer of the Company performing 

the role of Plan Administrator.) 

You were the most highly compensated employee under the Plan 

(according to PBGC's actuarial valuation, as measured by 

average compensation at termination of employment, excluding 

any income or profit which may have been associated with 

ownership of Company stock.) 

Based on our review of the administrative record, we did not 

find a sufficient basis for concluding that you had the "title of 

an officer but not the authority of an officer." Thus, we found you 

were an "officer of the Employer." 

Your Status as a Kev Emplovee 

The Board found you were a Key Employee, as defined under 

Section 1.23(a) of the 1984 plan and Section 1.32(a) of the 1989 

Plan, because you were an officer of the Employer whose Section 410 

Compensation exceeded the stipulated compensation limits in all 

Plan years that the Plan was Top Heavy e., from 1984 through 

1993). 

Decision 

Applying the provisions of the Plan to the facts in this case, 

the Appeals Board found no basis for changing PBGC's determination 

that you are not entitled to a Top Heavy Plan benefit. This is the 

agency's final action regarding your appeal. 
You may, if you wish, seek court review of this decision. If 

you need other information from PBGC, please call PBGC's Customer 

Contact Center at 1-800-400-7242. 

Sincerely, 

Sherline M. Brickus 

Member, Appeals Board