I know this isn't the case for everyone, but I've converted completely over to City of Berkeley tap water on my reef tanks and I have not had any issues with coral health or nuisance algae in the five months since I've converted.
A couple things to point out:
Not all City Water is created equal, nor are pumping in houses, or neighborhoods.
My tanks were established tanks, well over a year old.
I run a heavy bag of Purigen (re-bleached every three months) and a bag of Chemi-pure (every 4 months).
I don't run SPS, but a variety of LPS and softies.
I'm firing up a new tank, its actually in the middle of its first cycle, I am going to try this tank at 100% tap water, not sure how it will work out, since it doesn't have the advantage of being an established tank. But one thing I know for sure, it sure is nice to fill a 5gal bucket in the bathtub, put a cap of Prime in it, mix the salt over night and go right to the tank. No RO/DI units, no runs to grocery store, and its cheap!
Again, disclaimer not all City Water is created equal and not all tanks are either!
Cheers,
Josh