The volcano on Big Island is one of the world's most active but its activity level has increased substantially over the past 12 days.
In a news conference, scientist Michelle Coombs of the US Geological Survey said the activity could become explosive again.
Such observatories already exist in Hawaii, Alaska, California, Wyoming and Washington, but the legislation would upgrade and integrate the systems, expand the number of volcanoes that are monitored and create a grant program that would support research into emergency technologies.
The US Geological Survey had warned that an explosive eruption at Kilauea was becoming more likely as the volcano's lava lake was lowering.
Authorities by afternoon said weak winds and rain meant that ash fallout from the latest eruption was largely contained in areas around Kilauea's summit.
Hawaii's Kīlauea volcano erupted explosively early Thursday, tossing boulders hundreds of feet and sending a plume of ash about 30,000 feet (9,144 metres) into the predawn sky.
"This is one of the reasons that Hawaii Volcanoes National Park remains closed", Poland said.
Scientists said the eruption was the most powerful in recent days, though it probably lasted only a few minutes.
Hawaii's Kilauea volcano has erupted from its summit, shooting a dusty plume of ash about 30,000 feet into the sky.
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The National Weather Service warned: "Persons with respiratory illnesses should remain indoors to avoid inhaling the ash particles and all persons outside should cover their mouth and nose with a mask or cloth". The prohibition applies to a 5-mile radius around the crater.
It started erupting on May 3, prompting about 2,000 people to flee from their mountainside homes.
As the lava level shrank, "there is nothing holding those walls up", Krippner said. The eruption was short-lived with trace amounts of ashfall.
Another eruption of Kilauea volcano occurred on Thursday at 18:00.
However, Kilauea has experienced violent explosive eruptions in the past, Poland said, including several from roughly 1500-1800.
Hawaii Gov. David Ige said the state is forming a joint task force that could handle mass evacuations of the Big Island's Puna district if lava from Kilauea volcano covers major roads and isolates the area. The lava flow which has traveled almost two miles from the fissure seems to have stopped moving for now, though more lava flows remain possible, and geologists warn that additional fissures could open up at any time.
Those areas were evacuated as lava destroyed at least 26 homes and 10 other structures.
Earthquakes continue to shake the Big Island, with the most severe at around 8:30 a.m. producing a 4.4 magnitude quake.
At first look, Kilauea seems to be a part of the bigger volcano Mauna Loa.