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I know this message is a bit old, but here's my $.02 anyways...
When I built my last house, it was on the municipal water supply, and the town required me to install a device to lower the water pressure since my house was near the system supply, and apperently since I was near the pumps I would have had high water pressure in my house, too high for residential plumbing fixtures to handle.
What I installed between the city supply and anything in my house was called a pressure reducing valve. (PRV). Perhaps this is what your inspector was talking about?
It limits the city water pressure to a standard household pressure.
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