The sacrificial anode in the water heater may be causing this smell. Anodes of different types are available.

Is the smell from the cold water also, or just the hot water? Does is correspond with changing seasons or does it seem to be random?

Bus driver is correct that it could be caused by the anode in the hot water heater, but there could be other causes as well. The city water folks are also correct - it's probably not their problem. It takes only a small amount of some sulfur compounds to cause an objectionable odor, too small to cause harm and too small to remove in a large scale operation at the city. As with most water issues, the first step is a water test. Call a water pro in your area and explain the situation. They should be able to perform a test for you. OR, find out where the city gets its testing done and take your own samples to the same lab. Make sure you ask about sampling technique - it has to be done in a certain way to get a valid test. You'll want to know the type of sulfur compounds you have in order to determine what to do about it.