Inland Waterways Development Act of 1985

Inland Waterways Development Act of 1985 - Amends the Inland Waterways Revenue Act of 1978 requiring transfer to the Inland Waterways Trust Fund amounts equivalent to the revenue from the tax on fuel used in commercial transportation on inland waterways and the user fees on vessels in such transportation previously equivalent only to the tax on fuel).

States that the funds derived from the fuel tax shall be expended for new construction of navigational features on inland and intracoastal waterways described in this Act. Requires funds derived from the user fees to be expended on Federal navigation projects in such waterways and to pay the costs of collecting such fees. Directs the Secretary of the Army to transfer a portion of the trust fund to the Tennessee Valley Authority.

Redefines the inland and intracoastal waterways of the United States to consist of specified waterways.

Amends the Internal Revenue Code to impose a user fee on vessels used in commercial waterway transportation. Excludes the following from liability for such fees: (1) vessels not engaged in commercial activity which are owned or under the control of the United States or another nation; (2) vessels used by a State or political subdivision; and (3) vessels engaged in dredging activities.

Creates the Inland Waterways Users Board. Describes the Board's composition and duties.

Authorizes the Secretary to study, plan, design, construct, operate, and maintain new improvements and rehabilitations and modifications of existing improvements on specified waterways. Directs the Secretary to submit to the Congress a final environmental impact statement and a statement of compliance with the Clean Water Act, the Fish and Wildlife Coordination Act, and other laws before the initiation of such plans. States that such improvements shall be eligible for appropriations and may be undertaken unless a Joint Resolution disapproving the environmental impact statement becomes law within 180 days.

Declares that claims brought regarding work authorized by such plans may be filed only in a U.S. district court for the district in which the work is located or the injury occurs. Declares that injunctive relief may not be granted unless specified conditions are met.

Authorizes the following improvements: (1) Gallipolis locks and dams, Ohio River, Ohio and West Virginia; (2) White River Navigation to Batesville, Arkansas; (3) Bonneville Lock and Dam, Columbia River Oregon and Washington; (4) Atlantic Intracoastal Waterway Bridges, North Carolina; and (5) locks and dams 5 through 14, Kentucky River, Kentucky.