Northwestern’s decision to file a lawsuit against the city over the Northeast Evanston Historic District will have both short- and long- term ramifications on the university’s relationship with the city. But both parties might feel these effects sooner than expected as the city’s Budget Committee continues its discussion of a proposed employee head tax.

Al Cubbage, NU vice president for university relations, said the university will consider legal action against the city if it approves a proposed head tax that would cost NU $10 for every employee per month.

At the committee’s Nov. 8 meeting, aldermen said they seriously were considering the measure, which would impose the tax on institutions with more than 1,000 employees: NU, Evanston Hospital and St. Francis Hospital.

The city would receive $1.3 million a year in revenues from the tax, bringing it closer to reconciling its projected $3 million budget deficit for the 2001-02 fiscal year.

In its lawsuit filed Monday, the university cites the consideration of the head tax as an example of a “pattern of conduct that disregards the university’s charter rights.” NU’s 1851 state charter exempts it from paying property taxes.

Though Eugene Sunshine, NU’s senior vice president for business and finance, said administrators won’t hesitate to file another if they believe Evanston is still infringing on their rights.

“We will do what we have to do ultimately to protect our interests,” Sunshine told The Daily on Monday. “It’s what our job is — meeting our fiduciary responsibilities.”

Lindy Strodel, director of marketing for St. Francis, said Monday the three institutions have been meeting to discuss strategies and explore their options.

She said hospital administrators also have been consulting with their attorneys about the tax but are waiting to see what the council does before they make any legal decisions.

Ald. Edmund Moran (6th) said the city needs to cut back on the attacks against NU if it hopes to avoid more lawsuits such as the one filed Monday.

“I think this clearly raises (the idea) that the objections about the head tax by the hospitals and the university may end up in litigation too,” Moran said Monday. “While the city tries to create revenue in its budget, we’re spending our precious money on lawyers instead of improving the plight of the city.”

The Daily’s Ericka Mellon and Negar Tekeei contributed to this report.