Water does return to the water table when it rains or if you are near a river. However, the rate at which the water table replenishes is nowhere near the rate at which your people drink/bathe in it. So what you need to do is to create a closed loop system that keeps water flowing in your city forever.
The way that you do that is you build a sewage treatment plant -- which will pour dirty water back into the ground after "treating" it. You then plop a water treatment plant right next to it with a tank that cleans the water directly next to the sewage plant. This cleaning tank will suck the dirty water back out of the ground, clean it, then distribute healthy, clean water back to your Sims perpetually.