The letter outlines cuts of up to €1.2m from third- quarter grants from the central local authority fund based on the level of compliance with the levy in their councils.
Smaller, rural councils are the worst hit because they are more reliant on the funding than urban areas, which get more commercial rates from businesses.
The managers have a legal obligation to balance their budgets and will therefore have to make cuts to many community services.
Paul McSweeney of the Local Authority Management Agency, which is tasked with collecting the household charge, warned this week that “extreme measures” will be taken by councils to slash spending.
He said if there was not enough money, services would be stopped “which is why parks will be closed, mobile libraries won’t be going out, we may have to start switching off street lights except at junctions”.
Donegal has the lowest level of compliance with just 49% of households having paid. Its county council has had its funding cut from €7.7m to €6.6m.
Cork County Council has had its funding from June to September cut by almost €1m to €7.3m. It has already decided to suspend paying out €250,000 on community grants in order to achieve savings.
Local authority managers were told that if the rate of compliance improved, their funding would be restored accordingly before the end of the year.
Finance officers in most local authorities are drawing up budget reports to identify areas which can be cut, which will be discussed by councillors when they meet again in September.
Cutting staff wages is not an option because they are protected under the Croke Park Agreement.
Emergency services will also have to be retained, meaning other services such as libraries and community schemes will be hit.
Deductions from third-quarter installments of the local authority fund:
Carlow County Council: €246,235
Cavan County Council: €419,804
Clare County Council: €243,631
Cork City Council: €446,103
Cork County Council: €979,559
Donegal County Council: €1,016,872
Dublin City Council: €1,172,960
Dún Laoghaire/Rathdown County Council: €343,583
Fingal County Council: €545,285
Galway City Council: €123,887
Galway County Council: €779,835
Kerry County Council: €417,043
Kildare County Council: €564,622
Kilkenny County Council: €412,407
Laois County Council: €409,600
Leitrim County Council: €291,318
Limerick City Council: €203,098
Limerick County Council: €453,821
Longford County Council: €330,750
Louth County Council: €278,293
Mayo County Council: €641,589
Meath County Council: €644,835
Monaghan County Council: €340,589
Tipp NR County Council: €376,593
Offaly County Council: €386,784
Roscommon County Council: €436,249
Sligo County Council: €325,113
Sth Dublin County Council: €475,210
Tipp SR County Council: €462,782
Waterford City Council: €154,343
Waterford County Council: €507,283
Westmeath County Council: €414,356
Wexford County Council: €481,697
Wicklow County Council: €369,163