The algae you're seeing is a natural part of a new tank cycle. You're going to get an algae outbreak no matter what kind of water you use, so using tap is not a disaster. Like mintychicken (cool name, btw) says, algae comes in many colors. You're likely to see shades of red, brown and green algae during the initial cycle. Most should disappear on their own as the tank stabilizes itself. Others will be handled by your snails. And the rest can be removed during water changes.
What are your current ammonia, nitrite and nitrate readings? How about the salinity? If you're just starting out in the hobby you may not have a phosphate test yet, but most fish stores will test your phosphate levels for a small fee.
Also, how "live" was your live rock when you added it to the tank? Was it out of the water for a significant amount of time, or was it kept wet between the source and your tank? If your live rock had very little die-off, then your cycle will be different than if the rock was dry before you put it in the tank. If your rock already had a healthy colony of bacteria when it went into your tank, your cycle should probably be pretty much done after 4 weeks (I don't put much faith in the "live sand" that's sold in a bag, so the rocks are more important, imo). As long as your Ammonia, Nitrite and Nitrate have all spiked and fallen, you are ready to do a water change and add a clean up crew.
Disregard the numbers on this chart, as days and levels will vary from tank to tank. But overall this is a pretty good look at a new tank cycle:
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