In August, a windstorm knocked the stage into the crowd just before the band Sugarland was set to perform.
The settlement would give $300,000 to each family of the seven people who were killed. It would also cover part of the medical bills for the 61 injured.
They have until Monday to accept the offer or go to court.
If families and victims accept the offers, they wouldn't be allowed to sue the state. Some have already filed lawsuits challenging the state's liability cap of $5 million.
The proposed settlement is separate from a lawsuit filed last month against Sugarland.
The Associated Press contributed to this report.