Fife Council has sent a list of questions to the Scottish Government before it decides whether to accept or reject the budget.
With the deal on the table meaning Fife Council would have £24.4 million less than last year, the Labour-run authority has sent a letter to finance secretary Derek McKay seeking answers on a number of issues.
Depute leader, Lesley Laird, says the local authority needs more clarification on certain issues before it will accept any deal.
She said: “We’ve neither accepted or rejected it yet.
“We’ve asked a number of questions and await the answers to these points.
“There are a number of conditions to the offer, and a statement that if we don’t accept it there will be penalties - these penalties are not outlined.
“That’s not clear in Derek McKay’s offer. It’s reasonable for us to come back and say we don’t have enough information.
“The ball is in his court.”
Cllr Laird confirmed that Fife Council would have to accept a 3.9 per cent budget cut - which would mean a £33 million budget gap.
“That means we’ll have to make cuts – not savings,” she added.
“Cuts to services and cuts to jobs.
“That’s the reality we are in.”
Cllr Laird said Fife Council was also seeking information on what would happen if it was to reject the budget and stated that she believes the council should have more powers to raise funds.
Around a quarter of Scotland’s councils have rejected the budget to date.
Seven of the 32 local authorities have written to the Finance Secretary opposing his budget plans.
In a letter sent out to all the local authorities, Mr McKay noted they would receive a “revised and inevitably less favourable offer” if they failed to agree to the budget in time.
He intially gave councils until January 13 to accept the deal but then extended the deadline to January 20.