Its not like every pesticide is so strong its going to kill you and leave your children with two heads, but yeah it doesn't sound a great idea to pour it into a water course. I suppose it depends how much, how frequently they do it, and if it rained recently or if water levels were low (to dilute). Sounds like time to write an angry letter to the council ;-)
Interestingly, even organic food has a list of approved pesticides that can be used (some of which are artificial, copper and sulphur based etc). But substantially less is better than the huge amount we use at the moment I guess.