This bill, titled the "Watershed Protection and Forest Recovery Act of 2025," creates an Emergency Forest Watershed Program within the Agricultural Credit Act of 1978. It authorizes the Secretary of Agriculture, acting through the Chief of the Forest Service, to undertake emergency watershed protection measures on National Forest System land. These measures are designed to address runoff retardation, soil-erosion prevention, and flood mitigation caused by natural disasters or occurrences that threaten natural resources, water, life, or property downstream. The program allows the Secretary to enter into agreements with state and local governments, Indian Tribes, and water districts (sponsors) to carry out these vital protection efforts. Agreements must be executed expeditiously, with measures completed within two years of a disaster and potential monitoring for up to three years. Significantly, the bill waives matching requirements for payments to sponsors and limits their liability, except in cases of willful negligence or reckless conduct. Furthermore, the legislation streamlines environmental review by deeming these emergency measures as emergency response actions for NEPA compliance. This aims to expedite critical interventions to restore forest health and protect communities from immediate post-disaster risks.