What's really going on here:
1. We have aging infrastructure. Old pipes and old plants. This has a fairly straightforward solution. The municipalities and companies that own this infrastructure will need to take on financing to fix and upgrade systems. This is something they can and will do as these things become more of a problem. But it is pretty classic investment, they own and benefit from this investment. Some people will complain, but life will go on.
2. We take clean water for granted and have a number of conflicting economics that have resulted in water quality degradation, largely in the midwest. Farmers want to improve yields, so they fertilize more (and till crops which have higher runoff). This gets into the water, where people with little economic stake in the crop production and municipalities have to pay for dealing with the lower quality water. (Note: NY City, as an example, has taken a very proactive approach to dealing with this by super actively managing the lake watersheds from where they get their water, they own something like 30% of the land in some of their key watersheds). This issue isn't as much population growth as runoff and the modern economics of agriculture.
3. Arid and dry areas like the southwest have a host of completely different challenges. There, a lot of cities have undergone rapid population growth, demanding more water. There is only so much water to go around in those regions and, on top of it all, they are in one of the worst long-term droughts on record (there was one worse drought in the middle ages). They are struggling to keep up with demand. Strong price signals and most importantly, a re-assessment of the volume of water that goes to agriculture in very dry areas (at crazy inexpensive rates) could go a long way to improve this situation. Also, luck of the draw may help if we leave this long-term drought.