Water is a scarce resource in some places. Rationing water on a market is a reasonable solution. We do it for literally every other scarce resource. Food, oil, iron, etc.
Oh, I know, it 'needs to be managed' because its 'scarce'. Having lived in Los Angeles for a significant period of my life, I know exactly where 'water management for the people, by the people' leads us .. to desperation for some, prosperity for others.