Gov. Chris Gregoire proposed Tuesday what she called a "responsible, balanced approach of painful cuts and new revenue" to close the state's $2.6 billion budget shortfall. But Gregoire's latest budget blueprint — which relies heavily on hoped-for federal money and one-time fund transfers — did little to answer long-term questions about the sustainability of current spending levels. In her annual State of the State address to lawmakers and subsequent testimony to a state Senate panel, Gregoire said the state should tap $780 million in new revenue to avoid eliminating key services such as subsidized health care and scholarships for low-income families.