Annually, the superintendent shall recommend, and the board shall approve, as part of the budget process, a desired fund equity level.
Fund equity may be used to (1) supplement possible shortfalls in state, federal, and local revenues, or (2) be used as a reserve for possible emergency expenditures, or (3) for other reasons deemed necessary by the board.
Emergency expenditures may not be taken from the fund equity unless possible surpluses in the existing school budget have been appraised. Emergency expenditures must be recommended by the superintendent and approved by the board. Fund equity funds may not be transferred to expenditure accounts without board approval.