The California water board has proposed the first-of-its-kind, $1.5 million fine for water-taking during the drought.
The move announced Monday targets a group of Central Valley farmers.
The State Water Resources Control Board said it's proposing the first fines of this kind for a water district with century-old claims to water.
The so-called senior water rights holders are generally protected from mandatory cutbacks.
The board says the Byron-Bethany Irrigation District illegally took water from a pumping plant after getting a warning that there was not enough water.
The district serves farmers in three counties in the agriculture-rich Central Valley and a residential community of 12,000 people.
District spokeswoman Erin Gilhuly did not have an immediate comment. The district has sued the state over water cuts.