House Loan Measure Would Free Up Cash for Early Education

Passage sends college-lending overhaul to Senate

Early-childhood-education programs and school facilities would get major new federal aid under a bill approved last week by the U.S. House of Representatives that would cover the cost of that spending by revamping the way the federal student-lending program operates.

The House legislation, which passed Sept. 17 by a vote of 253-171, would scrap the Federal Family Education Loan Program, under which the government subsidizes private lenders to make federal loans.

Instead, starting in July of next year, all loans would originate with the William D. Ford Federal Direct Student Loan Program, in which students borrow from the U.S. Treasury. The change, largely based on a proposal put forward by President Barack Obama, would save about $87 billion over 10 years, according to the...