Houston, Texas - Relatives of children killed or wounded by a mass shooter in Uvalde two years ago have reached a $2 million settlement with the Texas city, a lawyer for the families said Wednesday.

Nineteen small children and two teachers were killed when a teenage gunman went on a rampage at Robb Elementary School in May 2022 in America's worst school shooting in a decade.

The response by law enforcement to the situation has come in for harsh criticism after a Justice Department probe found there were "critical failures" by police.

Officers eventually shot and killed the gunman but waited more than an hour before storming the classroom where he was holed up.

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Josh Koskoff, a lawyer for the families, announced the settlement with Uvalde at a press conference and said a lawsuit was also being filed against 92 members of the Texas Department of Public Safety and school officials.

"We are suing the state of Texas, and we're also suing, down the line, we'll be suing the federal government," Koskoff said.

"You had over 150-odd federal officers there, who also were there and stood around until one or more breached the room at 77 minutes," he said.

In addition to the $2 million payout to be shared among the families, Koskoff said the city has agreed to enhance the training of police officers and provide continued mental health services to survivors and their families.

It will also build a memorial to the victims and establish May 24, the day of the shooting, as an annual day of remembrance.

"Pursuing further legal action against the City could have plunged Uvalde into bankruptcy, something that none of the families were interested in as they look for the community to heal," attorneys for the families said in a statement, alluding to the relatively small size of the settlement.

The relatives of 17 children who died and two who were wounded were parties to the settlement.

Veronica Luevanos, whose daughter Jailah and nephew Jayce were killed, said the settlement "reflects a first good faith effort by the city of Uvalde to begin rebuilding trust in the systems that failed to protect us."