The bill establishes a new Forest Health Grant Program, which will be administered by the state forester. This program aims to support eligible forest health projects by providing grants that cover up to 75% of project costs, with a reduced cap of 50% for projects on federal land. The projects must serve the public interest and can include enhancements to water yield, wildfire risk reduction, increased forest product production, and wildlife habitat improvement. The state forester is responsible for setting the application process and ensuring that matching funds are secured for the projects. Additionally, the attorney general must certify the legality of each grant before it can be awarded.

The bill also creates a dedicated account for the Forest Health Grant Program, which will consist of funds designated by law and can receive donations. The state forester is required to report annually on the grants awarded, and the program will have a sunset provision, ceasing to approve grants after July 1, 2030. Any remaining unobligated funds will be returned to donors or revert to the general fund, depending on their source. The bill appropriates $3 million from the general fund to support the program, with the intent that future funding will be included in the state forester's budget requests. The act is set to take effect on July 1, 2026.