I cannot even begin to explain the insidious local politics surrounding the local water utility in the city where my folks used to live and the way they forced homeowners to hook up to the ever-expanding sewer at cost to the homeowners, regardless of whether their existing septic systems were adequate or not, to pad the pockets of the contractors paid by the city and to aid in further annexation of the area outside the city.
A water utility run by the local government as a monopoly is only regulated by local politics, and if you have any experience with local politics you know that's mostly just figuring out who's the biggest good ol' boy.
(The flip side would be "Are you saying Google should be a nationalized, government-regulated search engine?")
There are also other ways to run a household that don't depend on running water. (Heck, my great-grandpa never complained about having an outhouse.) Are you saying your local water utility should be an unregulated monopoly?