They have reserve funds to keep the state out of the red. Alaska is borrowing no money to keep its budget afloat as is. That means continuing infrastructure projects and all of its very frugal public works going.A total of $1.36 billion and approximately $1.2 billion are estimated to be withdrawn for FY 2009 and FY 2010 respectively. “Responsible reductions and prudent use of reserve funds that we had set aside for tougher times will help us weather the storm,” said Palin.
And as oil prices start going up again (as evidence that they are, I simply refer you to the pump), the budget shortfall will decrease and the budget will return to normal. Basically, these eventualities are planned for.