Try about 12.0 gr Blue Dot with any bullet less than 60 gr. I haven't gotten sterling accuracy with the loads out of a Handi, but I have been assured they produce 1" or less at 100 yards out of bolt actions.
Here's a thread I posted on another site that deals with reduced loads to the extent of 4 pages.
I normally get 1 1/2" or less groups with these loads at 100 yards out of my synthetic .223 with standard barrel.
I forgot to mention, "Seafire" is the fellow to search for on the site that is posted above. He's the one that got me started using reduced loads with Blue Dot.