The Daily Post understands that Knowsley has already indicated it will underwrite the money, though the council wants to pay slightly less than Liverpool, in line with the proportion of populations in the two areas.
Liverpool has been slightly more cautious but the Daily Post understands that senior council members have said they are willing to press ahead.
The ruling Liberal Democrats are keen to see the project finally get off the ground.
Of the 18 members, nine were in favour of the loan, five members from Wirral and Sefton abstained, five were absent and one from Wirral objected.
Labour leader of Wirral Borough Council Steve Foulkes said: "We do not agree that the tunnel tolls should subsidise the Merseytram scheme.
"It is now up to Liverpool and Knowsley Councils to decide whether to underwrite the contingency and they will discuss that at the next full council meetings.
"We can only hope they decide not to so this loan does not go ahead."
A spokesman for Merseytravel said last night: "Arrangements whereby Merseytravel can borrow up to £40m from the tunnels have been agreed.
"We can now move on to the next stage in the process."
A spokesman for Liverpool City Council said: "The city council only received a formal request from Merseytravel about funding for Merseytram in the last few days.
"This project represents a major financial commitment for the council, and the latest proposals will need to be carefully considered.
"It is difficult to give a timescale for when this detailed evaluation will be completed as this is a very complex undertaking and we have not seen all the documentation and agreements reached by Merseytravel on this issue."
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