The Oregon Department of Environmental Quality (DEQ) issued the fine to ConAgra Foods Lamb Weston for the violation at its frozen fruit and vegetable processing plant in Hermiston.
The plant violated the permit by exceeding the limit for disposal of nitrate, a pollutant generated in sewage treatment.
The company operates a sewage treatment plant at the site under a DEQ-issued Water Pollution Control Facilities permit.
The DEQ said high levels of nitrate can pollute groundwater wells and present a public health concern.
ConAgra Foods Lamb Weston has until 26 September to appeal the penalty.