BOTH North Devon and Torridge district councils said they were disappointed at the announcement but said they had been preparing for significant cuts.
In actual funding terms, North Devon's grant will be reduced from £6.6 million to £5.7 million in 2014/15 and then to £4.8 million the following year.
"What's equally disappointing is that the voices of our community, who petitioned for a fairer rural deal, appear to have been ignored," said Brian Greenslade, North Devon Council leader. "For months and months we have been campaigning, calling for central government to bridge the funding gap between urban and rural areas.
"The Government has now responded by offering additional grants. But in real terms, this will probably mean North Devon gets just £4,000 more from the rural pot. Certainly not enough to make any real impact."
Torridge's grant will be cut by £700,000, or around 15%.
Torridge leader Phil Collins said: "The figures we received, while disappointing, are almost exactly what we were expecting and in line with the budget reduction plans we have been working toward over the last year or so."
Both councils will look at ways of balancing their budgets before being discussed at meetings in February.