In previous years, council chiefs or producers of the festival were not asked to fork out for policing costs, but Police Scotland has adopted a new nationwide charging regime, endorsed by the Scottish Police Authority, which sees event organisers pay up to £83 an hour per officer.
Event promoters Unique Events and Underbelly already pay for around 500 stewards to work at the party. It is understood some 300 police officers were also on duty last Hogmanay.
But city leaders believe the Hogmanay festivities should be given special dispensation because of their iconic status and the benefit they bring to the whole country.
Unique Events and Underbelly agreed a fixed-price tender of £1.3m a year with the city council at the end of 2012 and say they are unable to absorb the extra costs.
The row is still unresolved, despite months of negotiations and a final decision looks unlikely before the official launch of the Hogmanay programme later this month.
Police Scotland claim the celebrations, which are worth more than £30m to the national economy, should be treated as a “commercial event”.
Although the main street party on Princes Street was a free celebration when it began in 1993, revellers have been charged for tickets for the past decade, with the cheapest now costing £22.10.
Council festival and events champion Steve Cardownie said: “We are pressing for full abatement of the policing charges and a stay of execution on this until after the 2015 event. We were not made aware of these extra costs when we set the budget for the event, which is far too valuable for us to compromise on its safety.”
Police Scotland said a “consistent” policy was being applied across the country and it could not “absorb the cost of events at the expense of the public purse”.
But it denied the bill would be as much as £250,000 and said discussions were continuing with the council.
Chief Superintendent Mark Williams said: “We’ve been working with the council and event organisers for some months to plan and deliver this year’s Hogmanay celebrations.
“Part of that dialogue includes the charging arrangements. Planning is at an advanced stage and I am certain all the agencies involved will work together to deliver a fantastic event.”
Pete Irvine, managing director of Unique Events, said: “We are included in the discussions with Police Scotland and the council to ensure Edinburgh’s Hogmanay retains its reputation as one of the safest urban events in the world.”
One source said: “It is a farce that this issue has not been resolved so close to this year’s event. A compromise will have to be found in the next few weeks.”