"I think this is really good news. We'll be really looking to see the museum in there doing displays at certain times of the year," he said.
Mr Gibbs said the museum's entire collection would not fit into the old fire station so static displays would be set up and changed throughout the year.
The old fire station was a good fit for the museum as the community had raised the money for it to be built, he said.
"The community worked really hard to build their very first fire station," Mr Gibbs said. "That'll be quite historic."
In a written statement the council acknowledged the importance of heritage across the district but stated it was not in the business of providing museums.
Western Bay of Plenty mayor Ross Paterson said he was pleased the council could help get the museum up and running again.
It was forced to close due to financial trouble which meant the premises had to be sold late last year.
"They've had quite a lot of experience before and are a lot wiser for it. I think the've got a lot better possibility of making a success of it," Mr Paterson said.
The council road show generated more than 1000 submissions, the most the council had ever received, and many were to do with the museum, he said.
Mr Paterson said people were asked whether the council should be involved with museums and 60 per cent said yes.
The fire station would be a temporary home which would be reconsidered after the new library was built, he said.
The council would then consider what community groups could best use the old library building.
Mr Gibbs said he was also looking forward to the new, larger library which the council also agreed to fund during Long-term Plan deliberations.
The council approved the construction of a $2.3 million library in Katikati which will be built in 2016.
"We've been working on that for the nine years since I've been on the community board. I'm looking forward to having a new library. It's where we dreamt of having it in the first place.
"The schools use the library quite a bit and they won't have to cross the road."