I'd dearly, dearly love to provide an answer in my own right on this matter (and Cities Skylines does sort water supply and sewage under the same tab) but unfortunately, my own study has not yet got into a good and proper reading on the sanitation side of things. Thankfully, I do have some previous answers that go some way to answering this question, but as always, more can be said - especially on the downsides of these particular arrangements, which the following answers don't quite cover.