McMinnville officials could be stuck between a rock and a hard place when it comes to increasing water and sewer rates. The increase could be as high as 20 percent.After reviewing the city’s budget for fiscal year 2013-14, the Tennessee Comptroller of the Treasury has informed the city that rates need to increase in the Water and Sewer Department or the state will step in and do it.“The fiscal year 2014 budgeted revenues for the Water and Sewer Fund do not appear to be sufficient to meet all operating expenses and are not sufficient to create a positive change in net assets,” said Sandra Thompson, director of the Office of State and Local Finance.Because the department is an enterprise system, user rates, fees and charges must be sufficient to meet the actual costs of providing water and sewer services to city residents.According to the letter, the department’s expenses exceed revenue by $854,388.Water and Sewer Department interim director Bill Brock says he has begun reviewing the department looking for ways to decrease expenses. According to numbers generated by Brock and presented to Water and Sewer Committee members, a 15 percent increase in rates would generate an additional $808,136, and a 20 percent increase in rates would generate an additional $989,194.To show officials what various increases would look like on an actual water and sewer bill, Brock brought in his.