The Grade-I listed landmark, which has been owned by the council since 2010, needs "essential" strengthening work to be carried out on its steel structure.
A council report says a continuing £6m steel renovation project has cost extra money, but the loan will be recouped from the income of leisure assets.
Councillors will consider the proposal on 20 July.
Deputy leader of Blackpool Council Gillian Campbell said the tower was "a vital asset to town" which the council was "committed to keep in a good condition".
"Our acquisition of the tower was all about making sure it is looked after for many years to come and this work will make sure that continues to be the case," she added.
The seafront tower opened in 1894 and its design is inspired by the Eiffel Tower in Paris.

The trade body that represents the sector published research suggesting more than 10,700 jobs were directly supported self-catering tourism.
A further 4,500 jobs are indirectly supported by the money flowing through the sector, it claimed.
The research covers nearly 17,000 premises.
They have been classified as self-catering properties by business rate assessors.
That does not include homes for rent through websites such as Airbnb.
The findings follow economic research into the impact of golf tourism in Scotland, which was published this week and which found there was nearly as much value from that, at £286m.
The VisitScotland and Scottish Enterprise study found growth of 30% in value between 2008 and 2016, with 4,700 jobs thought to be supported by golf tourism.
The self-catering research has been carried out by the Frontline economics consultancy for the Association of Scotland's Self-Caterers.
It drew on data from 2015 and 2016, including visitor surveys, assessors' statistics on non-domestic rates, and online surveys of both visitors and property owners.
It concluded that 23% of visitors to Scotland rented a self-catering property for at least part of their visit.
Of those, 32% came from England, with the north-west being the largest regional contributor and London the smallest.
Scots renting self-catering properties in Scotland accounted for 30% of the total, while the other 27 EU nations represented only 4%.
Most groups were made up only of adults, with children included in 30% of rentals.
The average spend on accommodation was reckoned to be £643 per group, totalling £313m.
They spent, on average, £245 on travel to and from the property.
While the total spend was reckoned to be close to £800m, the value added to the economy in 2016 was put at £293m.
Of that, £79m was in the Highlands, including Moray, supporting 4,100 jobs, directly and indirectly.  Edinburgh and the Lothians saw almost £50m of economic benefit over a year.
Meanwhile, the golf tourism research estimated that overseas golf visitors spent an average £338 per night during a trip to Scotland last year - more than four times the daily spend of the average overseas visitor.
Almost half of golf visitors staying at least one night in Scotland were from overseas, with the average being more than 10 days.
The North American market represents 30% of the total, with 14% from the rest of Europe.
Most overseas golfing visitors had visited Scotland before, and one in eight golfing visitors was female.
Those women tended to be better golfers, with lower handicaps.
Danny Cusick of Scottish Enterprise, which co-funded the research, said Scottish golf has "tremendous international appeal, so it comes as no surprise that the value of this important tourism sector has grown enormously in recent years.
"But we mustn't rest on our laurels; we want ambitious Scottish golf tourism companies to capitalise on this upward trend and consider how best they can develop and scale their business to meet the growing domestic and international demand."
Councillors in Blackpool are to be asked to approve borrowing of £1.8m to repair the resort's tower.
[NEXT_CONCEPT]
Visitors who rent self-catering properties are thought to be worth almost £300m to the Scottish economy, according to new economic research.