Public Securities Act of 1985

Public Securities Act of 1985 - Title I: Establishment of a Self-Regulatory Organization with Respect to Municipal and Government Securities - Amends the Securities Exchange Act of 1934 to expand provisions concerning the registration, regulation, and disciplining of municipal securities dealers to govern all public securities dealers. Defines "public securities" as municipal and Government securities. Reestablishes the Municipal Securities Rulemaking Board (MSRB) as the Public Securities Rulemaking Board (PSRB) and increases its membership by two. Empowers the Board to formulate rules regulating: (1) the amount of initial and maintenance margin in connection with the purchase, sale, or carrying of Government securities; (2) the type of deposit or collateral which shall be furnished; (3) the carrying of undermargined accounts for limited periods and under specified conditions; (4) the withdrawal of funds or securities; (5) the substitution or additional purchase of securities; (6) the transfer of accounts from one Government securities broker or dealer to another; (7) special or different margin requirements for delayed deliveries, short sales, repurchase and reverse repurchase agreements, and arbitrage transactions; and (8) the bases and methods to be used in calculating collateral deposits, and margins and market prices.

Sets forth conforming amendments. Empowers the Board of Governors of the Federal Reserve System to prescribe requirements for the initial or subsequent maintenance of a deposit in connection with the purchase, sale, or carrying of a Government security. Directs the Securities and Exchange Commission to consult with the Federal Reserve board and the Department of the Treasury when prescribing capital requirements for Government securities dealers to assure that such requirements do not adversely affect the efficiency, liquidity, or integrity of Government securities markets.

Title II: Transitional and Savings Provisions - Provides for the: (1) transfer and allocation of funds and personnel from the MSRB to the PSRB; (2) termination of the MSRB; and (3) continuation of MSRB authorities, administrative proceedings, and judicial proceedings.

Title III: Effective Dates - Makes this Act effective 180 days after enactment. Provides effective dates for appointment and rulemaking authority under such Act.