The fate of that money—and the rest of the $60 million Penn State owes the NCAA—is the subject of two legal challenges, one from a state lawmaker and the other from Pennsylvania's governor.
On Wednesday, a Pennsylvania judge put on hold state Sen. Jake Corman's request for an injunction barring the NCAA from spending the money. Corman asked for the injunction request to be put on hold, indicating the filing had the support of the NCAA.
NCAA spokesman Bob Williams said the organization has not been negotiating with Corman, either about spending the $12 million or the larger lawsuit, and called his lawsuit groundless.
Corman, a Republican who represents State College and chairs the Senate Appropriations Committee, sued the NCAA two weeks ago, arguing the NCAA's plans to spend $60 million over five years from Penn State runs afoul of his oversight role in state spending. The state contributed $214 million this year to Penn State, which has a $4.3 billion budget.
"We believe the senator's lawsuit is without basis, and we intend to proceed with the litigation," Williams said. "As we've explained to the senator's lawyers in our discussions, no funds will be disbursed until a third party administrator is appointed, and until that time the funds are held in an independent account not controlled by the NCAA."
Corman's request to put on hold his injunction said the NCAA informed him "that for multiple reasons it has no intention to disburse or otherwise dissipate said funds in the immediate future," and agreed to give Corman two months' notice if that changes.
At a convention in Grapevine, Texas, NCAA president Mark Emmert disputed Corman's statement that the NCAA has been negotiating over the lawsuit and said his organization will never see the money or decide where it is spent.
"A group of presidents and others are setting up the framework by which all that will happen," Emmert said. "As they set that up and get it all in place, then indeed that group can make a decision to dispense money."
Commonwealth Court Judge Keith Quigley's order put Corman's application for an injunction on hold unless Corman seeks to reactivate it.
Also Wednesday, Corman introduced a narrowly focused bill, the Institution of Higher Education Consent Decree Endowment Act, which would determine how matters such as Penn State's are handled. Corman's office said he believes it would also apply to the NCAA-Penn State consent agreement.
The act's primary provision is that fine money must go into a custodial trust in the state treasury, and the Pennsylvania Commission on Crime and Delinquency would distribute the money in the state for child sexual abuse prevention or to help victims.
The NCAA also is defending a federal antitrust lawsuit filed Jan. 2 by Gov. Tom Corbett that seeks to have the $60 million fine and other penalties against the university thrown out. There have not yet been any additional substantive filings in that case.
Penn State and the NCAA entered into the agreement in July, following Sandusky's conviction on 45 counts of child sexual abuse. The former assistant football coach is serving a 30- to 60-year state prison sentence but maintains his innocence.
AP sports writer Stephen Hawkins contributed to this story from Grapevine, Texas.