California Code, Streets and Highways Code - SHC § 2107.3

The incorporation of a new city, or any annexation or exclusion of territory to or from an existing city, shall be considered for the purpose of apportionment of funds pursuant to Section 2107. The revenue shall be apportioned among the cities monthly as revenues are received in the Highway Users Tax Fund. Any newly incorporated city or any increase in population due to annexation shall be included in the monthly apportionment following such incorporation or annexation.

In the event of the disincorporation of a city, or in the event the incorporation of a city is adjudged invalid, any funds apportioned pursuant to Section 2107 to such city, but which are unexpended, shall revert to the Highway Users Tax Fund  1 and shall be reapportioned to all other cities and cities and counties pursuant to Section 2107.

The Controller shall not be required to reapportion funds previously apportioned for expenditure in the different cities of the state by reason of any subsequent incorporation, invalidation of incorporation, annexation or exclusion of territory.