Josephine Dorothy Butler, 77, a founder and former chairman of the D.C. Statehood Party and a community activist whose interests included the conditions of the District's parks, world peace, the union movement and the welfare of children, died March 29 at Medlink Hospital in Washington. She had heart ailments and diabetes. Mrs. Butler was a former member of the Mayor's Health Planning Advisory Committee, the D.C. Human Rights Commission and the D.C. Coordinating Committee for the International Women's Year. In the 1970s, she twice ran for the D.C. Council as a candidate of the Statehood Party....