Governor Gregoire is directing state agencies to make plans for possible spending cuts in the 4-to-7 percent range, beginning Oct. 1.

Gregoire, sounding very sober despite a recent infusion of over a half-billion dollars in federal aid, told a Capitol news conference Thursday the cupboard is nearly bare, with this fiscal year’s projected ending fund balance now down to just $72 million (out of a $31 billion two-year budget).  As noted a day earlier, state tax receipts are lagging below expected levels. Gregoire says if the September revenue forecast comes in with more bad news, agencies need to be ready for across-the-board cuts.

Gregoire said there will be further cuts in January, when lawmakers arrive in Olympia and take up a supplemental budget, and again next July, when the new 2011-13 budget kicks in.  Gregoire said she’s preparing for a $500 million budget reduction for the last six months of the fiscal year (January through June, 2011), and will draft a 2011-13 budget that requires a 10 percent cut in many areas.