Along with passing historic health care for the uninsured, the House on Sunday night folded in substantial money for the underappreciated segment of American higher education: community colleges.

The reconciliation bill that the House passed and sent to the Senate paired both health care and college student loan reforms. At least $2 billion in savings from having the federal government, not private lending institutions, operate student loans will fund grants for community colleges over the next several years. An additional $2.5 billion will be committed to historically black colleges and institutions primarily serving Hispanic students, but many community colleges in California should qualify for some of that money, too.

The $2 billion is a substantially scaled-back version of President Obama’s $12 billion American Graduation Initiative, which he announced last summer with a goal of increasing 5 million college graduates by 2020. But at least what passed last night will provide money in hand at a time when Congress is under pressure not to expand programs that add to the deficit.

The grants to community colleges will be similar to the competitive I3 grants that the Obama administration is offering to K-12 school districts to promote reform.

At an EdSource conference in Santa Clara last Friday, Hal Plotkin, a former trustee of Foothill-DeAnza Community College District and now a senior policy adviser in the U.S. Department of Education, encouraged California schools to pursue the money. An expansion of open-source digital textbooks and the establishment of common course numbering system for community colleges are two ideas. Another might be a pilot program for performance-based funding, a concept that has been talked about for years, in which colleges would be partially funded based on successfully graduating students instead of simply enrolling them.

The Congressional Budget Office had projected $87 billion in savings from the switch to a government-run college loan program. But some of the savings have already been realized, and the bulk of the savings will go toward guaranteeing  and expanding Pell Grant funding over the  next decade ­ – a big win for the next generation of college students. But that also left less money for community colleges than Obama had sought, and money to expand preschool dropped out as well.

Still, Plotkin called it the greatest investment in community colleges since the GI Bill following the Second World War.