Wouldn't municipalities have more water if not for the ag rightsholders? (Honest question. Maybe I misunderstood how it works?)

Not really. Probably you can find some case where that is true, such as small towns that formerly used now-depleted aquifers, but on a population-weighted basis your typical California city has completely separate rights and infrastructure. Many of the municipal systems have very superior rights, way upstream. Our ancestors were idiots but they knew the rules of the game.

Hmm, I don't quite understand. Are you saying typical municipalities today (say, LA or San Diego) get their water from different sources than ag does, so they're not in competition with each other? (ie water not from the same watersheds or pipelines)?

Yes. Los Angeles does buy water from some ag rights holders but they also have dedicated supplies. San Francisco and the East Bay have totally separate rights that are upstream of everyone.

I think the main thing to know is that water is not like electricity. There is not a grid. Every municipal system has circumstances completely unique to it.

I see. Thanks for the correction! I edited my comment upstream.

If the agriculture used less water, you could divert it to cities.

True for SF & LA, but many other cities depend on State Water Project water which gets used by Ag as well - it's not just small towns.

Promptly, sure - but there's a system that can be changed overall, we should have the power to do so. For instance, groundwater depletion from ag limits municipal water supplies, or other ag use uses State Water Project water 'before' it gets sent down to SoCal. The more SWP water they use, the less Colorado water they use. It is a grid, and not always fully fungible, but more connected than people think.