Vargas was high on PCP and unarmed at the time of the shooting.
Last month, a federal jury found that Palamino and the City of Fresno did violate Vargas' 4th Amendment right against excessive and unreasonable force. But jurors found that Palomino was not negligent and that Vargas' death was not wrongful.
"This was hard for our family to go through and we're thankful that it's over," said Julia Enriquez, Steven Vargas' wife.
Enriquez spoke publicly just hours after a seven-figure settlement was reached between her husband's family and the City of Fresno.
"God. Steven, I love you!" said Jane Vargas, Steven's mother.
As part of the settlement, Fresno Police Chief Jerry Dyer promised to make several changes in his department to improve how officer-involved shooting investigations are handled.
He says the city will now make a good faith effort to complete those investigations within one year. Within six months of an officer-involved shooting, he or one of his leading commanders will talk with the affected family about the status of the case, he added. Dyer also promised to continue training before and after shootings to make sure officers act appropriately. He says he must do a better job of providing officers with feedback.
"In terms of monitoring, it will be a policy and it will be followed. And regardless of whether I'm the chief or the next chief, it is codified," said Dyer.
Dyer says he's already given the go-ahead for administrators to investigate the 19 cases still waiting for review from the Fresno County District Attorney's Office, including the Vargas case. Those cases could be closed without the District Attorney's input, he said.
"I'm thankful for the justice that we got for my husband, Steven Vargas, and I want to thank the jurors for helping bring justice for him," said Enriquez.
Dyer says he plans to put the announced changes in writing within 6 months.
The lawyer representing the Vargas family, Arturo Gonzalez, says he expects his clients to get a check sometime next week.