SAN JUAN, Puerto Rico (AP) — Puerto Rico's government formally exited bankruptcy Tuesday, completing the largest public debt restructuring in U.S. history after announcing nearly seven years ago that it was unable to pay its more than $70 billion debt.

The exit means that the U.S. Caribbean territory's government will resume billion-dollar payments to bondholders for the first time in several years, settle some $1 billion worth of claims filed by residents and local businesses and issue more than $10 billion worth of bonds. The government also will restore up to $1.3 billion taken from a public pension system.

"This is a significant success," said Natalie Jaresko, executive director of the federal control board that oversees Puerto Rico's finances and its debt restructuring process. "Remaining in bankruptcy has been a drag on the economy in multiple ways."

The bankruptcy led to widely criticized austerity measures on an island that paid some $1 billion in fees to consultants and lawyers and in other expenses during the process.

The exit was a priority for the board and Jaresko, who previously announced she is retiring April 1. A replacement has not been named yet. The board is expected to remain in place until Puerto Rico has four consecutive balanced budgets, a feat that has yet to be achieved.

The debt restructuring plan was approved by a federal judge in January. It reduces claims against Puerto Rico's government from $33 billion to just over $7.4 billion, with 7 cents of every taxpayer dollar going to debt service, compared with 25 cents previously.

"This is a transcendental moment," said Gov. Pedro Pierluisi. "The plan is not perfect ... but it has a lot of good things."

The board has clashed several times with Pierluisi and previous administrations, particularly on a proposal to reduce certain monthly pension benefits that was ultimately scrapped.

The plan also creates a public pension reserve trust that will be funded with more than $10 billion in upcoming years.

"For decades, past governments have neglected to put aside enough money," Jaresko said.

While many celebrated Puerto Rico's exit from bankruptcy, Jaresko said it is unlikely the island will be able to access financial markets soon because it has yet to get its audited financial statements up to date.

Puerto Rico accumulated more than $70 billion in public debt and more than $50 billion in public pension liabilities through decades of corruption, mismanagement and excessive borrowing. The U.S. Congress created the federal board in 2016, a year after the island's government said it was unable to pay its debt.

In 2017, Puerto Rico's government filed for the largest municipal bankruptcy in U.S history. Months later, Hurricane Maria struck, razing the island's power grid and causing billions of dollars in damage.

The island is still trying to recover from the hurricane as well as a series of powerful earthquakes that struck its southern region starting in late 2019. The coronavirus pandemic also has been a serious setback.

Still unresolved are the bankruptcy proceedings for the $5.8 billion in debt held by Puerto Rico's Highways and Transportation Authority and the Electric Power Company, which owes $9 billion, the largest debt of any government agency.

In early March, Puerto Rico's governor announced he was canceling a debt restructuring deal for the power company, saying that worsening inflation, surging oil prices and other factors had changed significantly since the deal was negotiated with creditors in 2019.

Jarekso said the board expects to soon renew negotiations, mediation and discussion with all those who bought bonds issued by the power company.