Sgt. Manuel Levi Loggins Jr., 31, was fatally shot in February 2012 by Deputy Darren Sandberg.
Loggins was shot after he crashed his SUV through a parking lot gate at San Clemente High School. His two daughters were in the vehicle with him.
Sandberg said he saw the crash and ordered Loggins to get out of the vehicle, but Loggins failed to comply with commands. That's when Sandberg opened fire.
The deputy was later exonerated by county prosecutors, who found the shooting justified. Loggins' family disagreed, and his widow filed a wrongful death lawsuit.
County supervisors voted last month to authorize attorneys to negotiate a settlement.
The Associated Press contributed to this report.