Child-Care Assistance Act of 1985

Child-Care Assistance Act of 1985 - States that nothing in this Act shall be construed to authorize interference with parental authority.

Requires States to submit a plan to the Secretary of Health and Human Services in order to participate in a child care assistance program authorized under this Act. Requires such State plan to include provisions on: (1) the designation of a responsible State agency; (2) distribution of funds, with priority to be given to child-care providers with priority for services on the basis of family need; (3) the establishment of fee schedules for services based on family need and size; (4) information and referral services; (5) child-care personnel training; (6) licensing of child-care providers; (7) parental involvement in the planning and evaluating of child-care programs; (8) maximum allowable administrative costs; (9) the establishment of a State Advisory Panel on child-care matters; and (10) hearings on adverse decisions of the State agency or any funded program.

Directs the Secretary to approve any plan complying with the requirements of this Act. States that the Secretary must first provide notice and a hearing before disapproving any State plan.

Directs the Secretary to designate, within the Department of Health and Human Services, an administrative unit and an individual in charge of such unit to carry out the provisions of this Act and to coordinate other child-care activities within such Department.

Provides for the establishment, within the Office of the Secretary, of a National Advisory Panel on Child Care Needs and Services.

Directs the Secretary, with the assistance of the National Advisory Panel, to develop standards for programs under this Act.

Authorizes the Secretary to make grants and to enter into contracts for demonstration child-care projects.

Directs participating States to submit a report to the Secretary outlining the current status of child-care licensing within the State. Directs the Secretary to develop a Model State Licensing of Child Care Providers Act as a guide.

Authorizes the Secretary to provide training and technical assistance to the States.

Limits allotments of funds appropriated under this Act to not more than one percent for Guam, American Samoa, the Virgin Islands, the Northern Mariana Islands, and the Trust Territory of the Pacific Islands. Establishes an allotment priority system for the States based on the number of children living in homes in which: (1) both parents are employed; or (2) the child resides with only one parent and that parent is employed.

Authorizes the Secretary, after reasonable notice and opportunity for hearing, to withhold payments to any State where there has been a substantial failure to comply with requirements of such State's plan or other applicable provisions under this Act.

Directs the Secretary to: (1) review and evaluate programs carried out under this Act; and (2) submit a report on national child-care needs to the President and the Congress not later than four years after enactment of this Act.

Authorizes appropriations for FY 1986 through 1990.