Va. Code § 15.2-2143
Every locality may provide and operate within or outside its boundaries water supplies and water production, preparation, distribution and transmission systems, facilities and appurtenances for the purpose of furnishing water for the use of its inhabitants; or may contract with others for such purposes and services. Fees and charges for the services of such systems shall be fair and reasonable and payable as directed by the locality. Except in counties which are not otherwise authorized, a locality may require the connection of premises with facilities provided for furnishing water; charge and collect compensation for water thus furnished; and may provide penalties for the unauthorized use thereof.
No locality, after July 1, 1976, shall construct, provide or operate outside its boundaries any water supply system prior to obtaining the consent of the locality in which the system is to be located. No consent shall be required for the operation of any such water supply system in existence on July 1, 1976, in the process of construction or for which the site has been purchased, or for its orderly expansion.
In any case in which the approval by such locality's governing body is withheld, the party seeking such approval may petition for the convening of a special court, pursuant to §§ 15.2-2135 through 15.2-2141.
Notwithstanding any provision of law to the contrary, any town with a population between 11,000 and 14,000, with the concurrence of the affected county, which provides and operates outside its boundaries any such water supply system may provide water supplies to industrial and commercial users outside its boundaries and collect such compensation therefor as may be contracted for between the town and such user. Such town shall not thereby be obligated to provide water supplies to any other users outside its boundaries.
Va. Code § 15.2-2143