Indianapolis and Citizens Energy Group, a nonprofit utility, announced last week the formal closure of a high-profile deal to sell the city’s water and sewer systems to Citizens.

The $1.9 billion deal marks one of the largest privatizations of a sewer and water system to date.

“Today marks a great day for our community,” Mayor Greg Ballard said in a statement.

Citizens, which already runs the city’s gas utility, will take over responsibility for funding and operating a $3.5 billion capital improvement project to upgrade the sewer system to meet Environmental Protection Agency requirements. Indianapolis has already financed some of the project, and remaining costs are estimated at $1.7 billion, officials said.

Citizens two weeks ago issued more than $1 billion through the Indiana Finance Authority to help finance the deal. The sale included $550 million of new money, part of which was used for a cash payment to the city, and $500 million of refunding sewer bonds. The utility also substituted its own credit for another $958 million of water bonds issued by the city.

Citizens maintains it can achieve up to $60 million in annual savings by consolidating the three utilities. The savings will help offset expected rate increases due to the sewer capital improvement program, officials said.

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