Aberdeen City Council is considering legal action against the Scottish Government and has given them just 14 days before pressing forward with a judicial review.
Council leader Jenny Laing has written to First Minister Nicola Sturgeon calling on her to negotiate with the Scottish Local Government Partnership over the financial settlements given to the local authorities.
The Labour-led authority quit the local government body, Cosla, in March last year to join the breakaway SLGP with counterparts in Glasgow, Renfrewshire and South Lanarkshire.
But the government has repeatedly stated that they will only negotiate with the original body.
Now, Mrs Laing has given the First Minister 14 days to respond before mounting a judicial review in the courts.
The correspondence states: “As highlighted in our letter to the previous Finance Minister, we have taken legal advice on your refusal to negotiate with us and believe we have grounds to mount a judicial review.
“It would be unseemly to drag this matter through the courts, but your Government’s intransigence is unacceptable and, therefore, we will seriously consider this option at our meeting of the SLGP on August 26 if we do not receive a satisfactory response.
“Since you have already begun your own negotiations with the UK Government on funding and started talks with COSLA on the next settlement for local authorities, I would call for a swift resolution to this issue.
“To that end, we would expect a reply to our request within 14 days.”
Mrs Laing is the current convener of the SLGP and has persistently called for more funding for the city.
She added: “The four members of the SLGP generate 47 per cent of our country’s economic output which is why the First Minister’s refusal to negotiate with us simply cannot be allowed to continue.
“This is why we have sought independent legal advice and, after careful consideration, we have grounds to serve the First Minister and her Government with a judicial review writ at the Court of Session in Edinburgh.
“We have sent clear warning of our intention to pursue such action if Nicola Sturgeon does not back down on this matter.”
An SG spokesperson responded: “Scottish ministers will always talk to individual councils on matters that concern them.
“Indeed, ministers and officials have regular and extensive dialogue with a full range of stakeholders from local government as part of and alongside our formal partnership arrangements with COSLA.
“We will only negotiate on the final settlement with COSLA, the representative body for Scotland’s local authorities.
“However, we have a statutory responsibility to consult all 32 councils on the terms of the local government finance settlement.”