The debts of the club now had risen to one million Finnish Marks, and also local rivals Reipas, likewise now relegated to Ykkönen, was in financial difficulties, and they had no way of achieving promotion back to top flight. There had already earlier in the decade been suggestions about a merger of these two clubs. Now this proposition was reconsidered. FC Lahti was suggestion for a new name, and at the same time it was considered that Kuusysi and Reipas would concentrate in youth work, and it was also suggested that FC Lahti would pay the debts of these two clubs according to a certain timetable. Kuusysi was the first to accept these suggestions, but it took longer for Reipas to be persuaded. Finally in November 1996, FC Lahti was officially founded. The new club was given Kuusysi's place in Ykkönen, and FC Pallo-Lahti took the place of Reipas in Kakkonen.