HARRISBURG, Pa. -- The recently fired CEO of PHEAA's nonprofit foundation says he was wrongly terminated and will take legal action to get paid what he says is owed to him.

Watch Jim Parsons' Report

It's a new twist in the saga of the state's student loan agency, where change was brought about when Team 4 investigated last year.

The Pennsylvania Higher Education Foundation fired Michael Hershock in March, alleging that his $15,000 in personal expenses were exorbitant.

Hershock disputed that claim Thursday, saying that he did nothing wrong, and he has asked the American Arbitration Association to order his $150,000 salary paid through the first three months of next year.

"I think PHEAA is really in trouble financially. I think their creditors are picking their bones," Hershock said. "I think they're struggling monthly to generate enough cash for payroll, and I think that's, in part, what this was about."

Hershock said the board owes him $190,000 and he plans to turn the tables on PHEAA board members -- most of whom are state lawmakers -- by issuing subpoenas for their expense reports.

PHEAA's board vice president, Sen. Sean Logan, of Monroeville, told Team 4 investigator Jim Parsons that he wouldn't discuss Thursday's developments because they concern pending litigation.

Eric Epstein, a PHEAA critic from Rock The Capitol, says Hershock and his attorney have no room to complain about compensation.

Epstein has filed a complaint with the Internal Revenue Service alleging that PHEAA overcompensated Hershock by paying him a salary and benefits, plus a pension with a grand total of almost $400,000 a year.

"You know, this circus that occurred today is essentially two fat cats crying over spilled catnip," Epstein said. "At the end of the day, I think what people need to understand is that the past isn't past, that greed still flourishes in Harrisburg. And to think that he could be compensated the way he was compensated and that the IRS is not going to take a hard look at it -- I think that is naive."

Hershock said he wants what he's entitled to under his employment contract and he's hoping to clear his name.

In 2007, a Team 4 investigation revealed state lawmakers on PHEAA's board spent more than $100,000 on retreats at resorts like Nemacolin.

Among the expenses was $580 for Logan and his wife to get a back cleansing facial, pedicure and manicure, and room service.

Former Westmoreland County Rep. Jess Stairs and his wife spent almost $2,000 on items like a gourmet cooking class, horseback riding and a hot stone massage.

Both lawmakers reimbursed PHEAA after Team 4 requested the expense records.

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