The city of St. Joseph, Michigan, has been forced to lay off employees because of a tight budget.

Fire Chief Kevin Luhrs was laid off on Tuesday.

Starting this week Police Chief Mark Clapp will also serve as the fire chief.

One person in the clerk's office and another person in the public services department were also laid off.

Two other workers retired.

City officials say they were short almost $500,000 and needed to continue to contribute to the pension fund.

“We've taken a hard look at what our expenditures area that don't effect our direct delivery to our residents and public services,” says Mayor Robert Judd explaining the cuts.

Besides the layoffs, $75,000 in annual spending has also been cut.

The three laid-off employees will receive four months of severance pay.

The city of St. Joseph, Michigan will now join many other small cities with one chief serving as two.

St. Joseph Police Chief Mark Clapp will now wear two hats, one for police and another for fire.

"I've already started duties as fire chief and continue duties as police chief. Its a major challenge, I've had great support and that's a major key from both fire staff and police staff," says Clapp.

And now Chief Clapp takes over a department he does not have any experience in, "The thing that people have to remember is even though I'm not trained firefighter, we have a staff of professionally trained firefighters and they will carry out that function."

Recently the city found out they needed to make a larger contribution to next's year pension fund.

Forcing them to either raise taxes, or make cuts.

"To be competitive and do the things you need to do I think you need to look at things the most cost effective way, you need a certain number of administrative people but the most important thing are the people on the street," the Mayor added.

St. Joseph officials say many other cities their size do not have a separate police and fire chief.

And this is not the first time St. Joseph has had a combined position.

They also had a similar situation back in the late 90's.