City-parish officials officially accepted $45 million in state funds Wednesday to upgrade the parish’s sewer system.

Department of Environmental Quality Secretary Peggy Hatch presented the funds to East Baton Rouge Parish Mayor-President Kip Holden during a brief news conference in the Metro Council Chamber.

The $45 million, in the form of a low-interest loan, will be used to upgrade sewer facilities and rehabilitate sewer lines as part of the parish’s $1.55 billion Sanitary Sewer Overflow program, said William Daniel, Holden’s chief administrative officer.

“It enables us to keep costs down,” he said.

Approximately $8 million of the loan will go to repairs and construction at the Choctaw Sewer Collection Maintenance Facility, said Mark Leblanc, assistant director of the Department of Public Works.

Another $4.5 million from the loan will go to providing the North Wastewater Treatment Plant with equipment that will help it reduce emissions, Leblanc said.

The remainder will go toward rehabilitating existing sewer lines, he said.

The terms of the loan include a 0.95 percent interest rate on a 20-year term, he said.

Holden said the terms made the loan more attractive.

“It’s a deal that’s hard to beat,” he said.

The SSO program is funded by sewer user fees and a half-cent sales tax. Those funds will be used to repay the loan, Holden said.

The program has a federally mandated deadline for completion of Dec. 31, 2014.

The funds come from DEQ’s Revolving Fund Loan Program.