I use that tap on the bottom to fill my son's tiny watering can and water seedlings. For my two-year-old, it's a good alternative to the hose, i.e. he can't blast mommy with a hose.
With a little planning you can forego a rain barrel and channel rainwater directly into your garden. You can find details on a page of the TreePeople website.
Either approach can keep water from flowing off your property. Once it hits the street, runoff picks up pollution that can be transported into waterways and out to the ocean.