The sub-branch and the City of Victor Harbor have agreement in principle for a lease over the library that has sat vacant since the council relocated to its new civic centre in April 2007.

Negotiations for a five year lease have been finalised and the move of the RSL branch will depend on the success of an application to transfer its liquor licence.

Victor Harbor’s mayor, Mary-Lou Corcoran, says the leasing of the library to the RSL is a "win, win for everyone".

"The proposal is fantastic, as it is a great facility for the education of our youth.

"It is good for the City of Victor Harbor, as it gives us time to sit down and make solid plans on its best use for the community," Ms Corcoran said.

The council called for expressions of interest in early 2007 for potential tenants.

In March 2008, after considering all 16 expressions of interest that had been received, the council agreed to enter into negotiations with the RSL to determine if a lease agreement could be reached.

"Council preferred the RSL bid because the organisation will soon be without a premises, as their current building has been approved for demolition, they demonstrated an ability to finance their occupation of the building and to undertake the renovations necessary and they were receptive to the terms and conditions of occupation sought by council," Ms Corcoran said.

The RSL has been searching for new premises for the past three years and the president Dave Miller is appreciative of the support given by the council.

"This move from Flinders Parade to the Old Library is a joint council and RSL initiative to preserve our military heritage.

"Flinders Parade is no longer attractive to members as it is and with the move to the Old Library in Coral Street there will be a genuine membership boost," Mr Miller said.