Don't start one. Invent one that fits Fort Madison's needs and resources.
Music festivals come in all stripes -- from participatory workshops in church basements to outdoor spectacles on New York alfalfa fields.
Seems the thing to do is get together a committee of the people of Fort Madison, decide what you want to do, then split up the homework to figure out what you can do.
Resources in the smallest towns usually include church and legion or Grange halls, maybe a bandstand at a local park, and a lot of local talent. Whatever is there, you can design your festival around it.