Butler City Councilman Michael E. Walter said that he’s worried about Butler’s financial health after a fund reserve that had been in the hundreds of thousands of dollars turned into a deficit.

Walter’s comments came during discussion at the council meeting Tuesday night about buying two new police vehicles for the police department that are expected to cost nearly $70,000.

Walter said he understood the need for replacing the vehicles, but pointed out that both the police and fire departments overspent their budgets last year by tens of thousands of dollars. He said that’s the case for many of the city’s departments.

“A lot of departments are this way,” said Walter, who is the council’s director of accounts and finance. “We’re spending money we don’t have.”

Walter said the only thing that allowed city officials to pay expenses, such as employee wages, in February was a $50,000 internal loan from the fund of the former parking authority.

“If it was still the parking authority, we wouldn’t make payroll this month,” Walter said.

Councilman Kathy Kline noted that police department overtime averages about $100,000 a year and unforeseen expenses, like retirements, often add to the department’s expenses and can’t really be planned for.

Walter said he was concerned that the city was headed for a state distressed municipality program known as Act 47. That allows municipalities to institute higher-than-normal tax rates to pay for expenses and debt, but also requires local leaders to work with a state-appointed official to reduce the municipality’s debt and expenses.

Walter said, “Our revenues are flat, our expenses are going up. We’re going to have to learn to live within our means. This is the end of the road.”

Councilman Richard J. Schontz Jr. agreed with Walter.

“We’ve been in dire straits for a number of years now,” Schontz said.