Under the existing trust that governs the use of the fund,money can only be used to purchase and maintain firefighting equipment and facilities,provide training and resources and cover administrative expenses.
The bill will expand the existing act to say donations can be used to support the families of any RFS volunteers killed or injured while on duty,help bushfire-affected communities and individuals and support people and organisations providing care to animals that have been injured or displaced.
About 1.3 million people donated a total of $51.3 million to Ms Barber's Facebook appeal but the money remains unspent.
The RFS said last week it wouldseek directions from the Supreme Court on how it could distribute the funds beyond its own operations.
However,Greens MP David Shoebridge said the problem was"unlikely to be fixed by any court application".
"It really needs a legislative fix,"he said.
"We want to ensure the intentions of the more than one million donors are respected and this record donation is able to be used to do more than offset government expenditure on the RFS."