The plan includes tough new rules forcing residents to use 10 percent less water by the year 2015. CBS News correspondent Sandra Hughes reports on why such measures are needed.
To combat California's water woes, everyone is having to cut back - and drought buster David Jones is making sure of it.
"It was approximately seven minutes from the time we left the yard before we encountered our first violation," said Jones, who enforces water rules for L.A.'s Department of Water and Power.
"In L.A., you can only water twice a week or face fines up to $600," he said.
"I certainly can't afford a ticket so I'm really glad he just gave me a warning," said Melissa Jordan, one violator Jones caught.
The conservation is needed because almost half the state is in severe drought. Towns and farms in the San Joaquin Valley - known as "the nation's breadbasket" - have been hit hard. About half of U.S. fruits, nuts and vegetables are grown there.
Wheat farmer Todd Allen could only harvest 40 of his 600 acres.
"It's getting to the point where give me water or give me death," he said. "I laid off five employees and some of them have been working here anywhere from 15 to 20 years."
More than half a million acres of California farmland have gone unplanted. Farmers don't just blame the three-year drought.
They're angry over new environmental rules aimed at protecting the endangered delta smelt. Because the fish can be sucked into pumps that distribute water to farm towns, the pumps have been turned down, delivering less water.
As California crop losses continue and farms begin to fold, produce prices will eventually go up. But there may be a more pressing matter. Food safety experts warn with fewer locally grown choices, there will be more foreign-grown produce on the shelves.
"Imported produce is three times more likely than produce that was grown in the U.S. to have salmonella or shigella or other contaminants that can sicken consumers," said Elanor Starmar of the advocacy group Food & Water Watch.
Back in L.A., the drought-busting may be backfiring; officials fear the rush of water through aging pipes on the two days a week when watering is allowed has caused more than 30 water main explosions (and one giant sinkhole).
In the San Joaquin Valley it's hopes that are sinking along with jobs. Unemployment has reached almost 40 percent in some places -and those who used to grow food are standing in line for it.