California Code, Education Code - EDC § 42610

Any amounts added to the general reserve of the school district in excess of the amount already budgeted shall not be available for appropriation by the school district for the current fiscal year except by the following procedure. The governing board of the school district shall, by formal action of the board, pass a resolution setting forth the need according to major classification of school district expenditures to be met from any portion of the general reserve derived from assured income in excess of the total amount anticipated in the budget. The resolution shall be submitted to the county superintendent of schools.

The county superintendent of schools shall approve any resolution for the appropriation of income to the extent that the income was not anticipated in the budget of the school district.

On the first day of July of each year, the general reserve together with unexpended balances of appropriations and income in excess of anticipated income for the preceding fiscal year shall be placed to the credit of the school district, and the school district shall include all money so credited in the balance shown in the budget for the ensuing fiscal year.