I'm sure most responsible companies use distilled water. They have their reputations riding on it. Even Coca-Cola uses distilled water in the making of their very bad for you products.
Consider that even products that are not FDA approved still have to conform to some standards. They have to list every ingredient in their products, for instance.
If they used tap water, companies might be under obligation to use expensive tests to make sure anything in the tap is under a specific amount that they don't have to list it.
Might be cheaper just to start with distilled water.