United States Trustees Act of 1985

United States Trustees Act of 1985 - Title I: Amendments to Title 28 of the United States Code - Revises and increases (from ten to 12) the groups of judicial districts to which a U.S. trustee is assigned to perform specified duties in bankruptcy cases. Reduces the U.S. trustee term of office from seven years to four years. Removes the 90-day limitation on the appointment of acting U.S. trustees.

Extends the authorities of U.S. trustees to include: (1) monitoring applications for fees and expenses; (2) monitoring reorganization plans and disclosure statements; (3) taking action to insure that all statutorily required reports are filed by debtors; (4) monitoring creditors' committees; (5) notifying and assisting the U.S. attorney if violations of criminal laws are discovered; and (6) monitoring applications filed to employ professional persons. Allows U.S. trustees to file comment with the court on such matters.

Increases the salaries of U.S. trustees from GS-16 to level IV of the Executive Schedule.

Establishes in the Treasury the United States Trustee System Fund for the operations of the trustees, including salaries and related benefits. Provides for the deposit of specified bankruptcy fees in the Fund. Requires the Attorney General to report to the Congress on the deposits and expenditures of such Fund not later than 120 days after the end of each fiscal year. Authorizes appropriations as necessary to supplement deposited amounts.

Repeals the authority of the Director of the Administrative Office of the United States Courts to name members to the panel of private trustees.

Increases the fee (from $60 to $75) to commence bankruptcy cases concerning liquidation and individual debt. Establishes a filing fee for reorganization cases equal to $5,000 or a specified percentage of the debtor's assets.

Title II: Amendments to Title 11 of the United States Code - Authorizes the bankruptcy court in involuntary liquidation cases to order the U.S. trustee to appoint an interim trustee (currently, the court makes such an appointment).

Declares that a U.S. trustee for the judicial district in which a case is pending is eligible to serve as trustee in such case.

Authorizes the U.S. trustee (in lieu of the court) to determine appropriate bond amounts for a person chosen to serve as trustee for certain proceedings.

Prohibits the court from removing a U.S. trustee. Empowers the U.S. trustee to remove a trustee for cause.

Prohibits compensation for services or reimbursement of expenses of U.S. trustees or standing trustees in individual bankruptcy cases. Requires, in cases where the U.S. trustee is due compensation, that such amount be paid into the Treasury.

Transfers, in liquidation cases, the following authorities from the court to U.S. trustees: (1) authority to convene and preside at meetings of creditors and equity security holders; (2) authority to appoint interim trustees; and (3) authority to appoint successor trustees.

Requires trustees in liquidation cases to file a final account of the administration of the estate with the court and the U.S. trustee. (Currently, trustees are required to file such an account with the court).

Authorizes creditors' committees to consult with the U.S. trustee in connection with estate administration.

Includes U.S. trustees in discharge proceedings.

Transfers, in reorganization cases, the following authorities from the court to U.S. trustees: (1) authority to appoint creditors' and equity security holders' committees; (2) authority to appoint trustees or examiners; and (3) authority to appoint trustees in railroad reorganization cases.

Repeals provisions concerning the U.S. trustee pilot program.

Title III: Transition and Conforming Provisions - Terminates the term of office of incumbent U.S. trustees: (1) two years after the expiration date of such term; or (2) four years after the effective date of this Act, whichever occurs first. Clarifies the scope of authority of such trustees and fixes their salaries.