YES! The Town water is very safe.
But.... if you are renting a cottage, ask the owner if he is on a well or town water.

Although most of Wasaga Beach has converted to Town water (and it is the law to do so), there may be a few who are on septic and well systems.
Wells can be full of all sorts of nasty things or they can be pristine and lovely to drink depending on location. Before I switched to Town water, my well tasted better and came up clean in purity tests but someone just down the street might have water that smelled and tasted of sulphur or other taste tainting elements.

Don't assume it's town water - ask. And, if you have no way of knowing for sure, a quick smell test might reveal some answers. A typical well in this area might have that sulphur (rotten egg) smell. It's usually harmless but not exactly nice for drinking or bathing. A musty smell is common also. A check of the colour might reveal a yellow or red tinge indicating various minerals. Wells throughout Wasaga Beach and area are different from one another even if they are located side by side. Don't assume that if the neighbour's well has been tested, yours will be safe.

As a long time traveller I would like to offer one more small piece of advice. Vacationers will often suffer from tummy distress and blame the water but often it's simply a drastic change of diet. We all tend to eat differently on vacation than we do at home. It's always a good idea to bring some Imodium to settle that rotten stomach but without being a wet blanket, common sense eating and drinking will help you avoid trouble. Some people are more sensitive to small changes in water, even clean town water might upset your stomach if you aren't used to it.  There are several drug stores should you find yourself feeling uncomfortable.