California Code, Penal Code - PEN § 4026

The sheriff or other officer in charge of a county or city jail may provide for the manufacture of small articles of handiwork by prisoners out of raw materials purchased by the prisoners with their own funds or funds borrowed from the inmate welfare fund, which articles may be sold to the public at the county or city jails, in public buildings, at fairs, or on property operated by nonprofit associations.  County- or city-owned property shall not be sold or given to prisoners for use under this section, except as expressly permitted by this section.  The sheriff or other officer in charge shall comply with subdivision (c) of Section 4025 and provide that the balance of the sale price of the articles be deposited to the account of the prisoner manufacturing the article after repaying the inmate welfare fund any amount borrowed.