Cal. Education Code § 33338

(a) The department or any other state agency that administers a grant or allocation of state funds to a school district shall allow an indirect cost rate that is not less than the indirect cost rate established by the department, unless a lower rate is required by law. (b) For purposes of this section, the following terms have the following meanings: (1) “Direct cost” means a cost that provides measurable, direct benefits to a particular program of an agency. Direct costs of a local educational agency include, but are not necessarily limited to, salaries and benefits of teachers and instructional aides, costs for purchasing textbooks and instructional supplies, and costs for providing pupils with counseling, health services, and transportation. (2) “Indirect cost” means the agencywide, general management cost of the activities for the direction and control of the agency as a whole. Indirect costs include, but are not necessarily limited to, administrative activities necessary for the general operation of the agency, such as accounting, budgeting, payroll preparation, personnel services, purchasing, and centralized data processing. (3) “Indirect cost rate” means the indirect cost rate established by the department for each school district. (4) “School district” has the same meaning as defined in subdivision (d) of Section 12000.