The family of a onetime Twin Cities librarian has agreed to a settlement exceeding $2 million with the Florida city where she retired and was accidentally shot to death during a citizen police academy exercise in August.

The deal awaits approval Wednesday by the City Council in Punta Gorda, where 73-year-old Mary Knowlton lived until she was shot to death in August in front of her husband of 55 years in a “shoot or don’t shoot” demonstration.

The exercise that led to the former Prior Lake resident’s death was designed to re-create a lethal force scenario involving police. The gun that was shot at Knowlton had been errantly loaded with live rounds.

As part of the proposed settlement that calls for the family to receive $2,060,234.23, the city “denies violating any laws or breaching of duties” in connection with Knowlton’s death, the agreement reads.

The deal, which also frees the municipality and its staff from any future claims made by the family, further notes that “the city and its officers maintain that they did not violate anyone’s civil rights nor act wrongfully or negligently during the incident.”

In a statement announcing the agreement, City Manager Howard Kunik said, “We respect the Knowlton family for their willingness to work with us and reach this agreement. We feel it is the right thing to do.”

The officer who shot Knowlton, Lee Coel, remains on paid administrative leave while the state decides whether he committed any “criminal negligence” in the incident, Kunik said Tuesday. Once that determination is made, Kunik added, “we can then do our internal investigation.”

In another case involving Coel, the city recently agreed to pay $70,000 to a man whose lawsuit contended that the officer and his K-9 used excessive force during a traffic stop.

The city’s insurance will cover $2 million of the settlement with the Knowlton family, with the balance coming from the municipality for the family’s legal fees, medical expenses and court filings.

Mary and Gary Knowlton were among 35 academy participants at police headquarters when Knowlton and one other person were chosen for the role-playing exercise.

Police say Knowlton assumed the role of a police officer. Photographs published by the Charlotte (Fla.) Sun showed Knowlton with a blue plastic gun and Coel decked out as a “bad guy” in a hoodie and mask. Both hands clutched the silver revolver as he’s about to fire the fatal round.

An investigation determined that live ammunition had been mistakenly mixed in with blanks.

Before retiring, Mary Knowlton was the librarian at Parkview Elementary School in Rosemount from 1988 to 2004, then was a substitute librarian at other schools in the Rosemount-Apple Valley-Eagan district through 2013.

The Knowltons moved to Punta Gorda from Prior Lake, where they had lived since 1973. Knowlton originally was from Austin, Minn., where she went to high school. She then studied at St. Olaf College, the University of Minnesota and Minnesota State University, Mankato.