Whitehorse residents should be bracing for a higher than expected hike to their water and sewer bills next year.

An unexpected city deficit of more than $600,000 means additional hikes are coming to what was already pegged to be a 4.7 per cent increase in next year’s budget.

The city’s 2014 budget, tabled in January, increased water and sewer rates by 4.7 per cent and an additional 4.7 per cent increase was expected next year. That figure is now looking closer to 6.5 per cent.

How the city chooses to implement the increase won’t be decided until the fall when the process of crafting a 2015 budget begins.

The deficit was found after auditors completed their review of the city’s 2013 financial statements. The finance committee also reviewed the statements and has no concerns to the report, council said.

Water and sewer services operates as a separate utility, and council noted, “in order to maintain the separation between taxpayer-funded activities and the operations of the utility, the deficit must be funded by ratepayers.”