The decision followed a consultation with the Waikouaiti Coast Community Board during which they identified what would best suit the community.
Waikouaiti Coast Community Board chairman Alasdair Morrison said the community was very happy about having a start date for the service.
Families could head into town on a Saturday or Sunday for sports games or shopping and would not have to worry about parking.
"At the moment the return trip costs $2 which makes it the most economical way to get into town."
Otago Regional Council transport manager Doug Rodgers said the Waikouaiti Coast community had been actively engaged in developing a solution that worked for them.
"We have received a petition from the Palmerston community which may result in additional improvements to the route."