Farm Credit Administration Improvement Act of 1985

Farm Credit Administration Improvement Act of 1985 - Amends the Farm Credit Act of 1971 to authorize the Farm Credit Administration (FCA) to issue cease and desist orders against any Farm Credit System institution or director, officer, employee, or agent engaged in an unsafe or unsound practice or in violation of any FCA rule or regulation. Provides for written notice and hearing opportunity.

Authorizes FCA to issue temporary cease and desist orders. Permits U.S. district court appeal. Permits FCA appeal to such court for injunctive enforcement.

Authorizes FCA to remove or suspend any Farm Credit System director or officer who has engaged in unsafe or prohibited practices, is in breach of fiduciary duty, or has been indicted for a felony involving dishonesty or breach of trust. Provides for written notice and hearing opportunity.

Establishes procedures for administrative hearings and judicial review.

Authorizes the FCA to apply to any U.S. district court with jurisdiction for the enforcement of any outstanding notice or order.

Provides for civil penalties of up to $1,000 for violations of final orders or of the provisions of the Farm Credit Act of 1971 or regulations. Makes directors and officers who knowingly violate, or permit others to violate, such Act or regulations personally liable for damages.

Amends the Farm Credit Act of 1971 to authorize the Governor of FCA to require the merger of two or more Farm Credit System institutions when: (1) such institutions are insolvent or not financially viable; or (2) such merger would provide borrowers with better service.