Mayor Lorraine H. Morton implored Evanston and Northwestern to come to terms with historical differences in her State of the City address Friday.

“The time for heated rhetoric, irate and ill-considered actions, and expensive litigation is over on both sides,” said Morton, according to a transcript of the address. “We can become architects of a daring partnership.”

Evanston and NU have traditionally squared off because the university, which is the largest institution in the city, is exempt from paying property taxes.

NU also sued the city in 2000 for placing 49 campus buildings within the Northeast Evanston Historic District, which university officials said was an attempt to rope NU in under the city’s preservation laws. Evanston City Council voted down a once-agreed-upon settlement on the lawsuit over the summer — meaning the case will go to court March 1.

Morton also lauded the city’s success in developing its downtown and said NU played a critical role in the process.

“Whether you want to believe it or not, none of our success in downtown Evanston would have been possible without Northwestern University,” she said. “The university gave birth to this city.”

She said NU’s contributions to community organizations and to Evanston/Skokie School District 65 prove the university’s commitment to the community.

Although he could not attend the mayor’s address, NU’s Senior Vice President for Business and Finance Eugene Sunshine applauded Morton’s comments as constructive and positive.

“The university administration and the Board of Trustees always have felt that a solid relationship with the city of Evanston is important to both sides — both for the future of the city and the future of the university,” Sunshine said. “I think that’s what Mayor Morton was getting at.”

But Sunshine added that he does not know if her comments will change the minds of any city officials regarding the university’s lawsuit against the city.

“We’ve always been interested in trying to settle (the lawsuit) and still are,” he said. “We agree that the future of the two institutions are intertwined.”

Ald. Elizabeth Tisdahl (7th), who voted in favor of settling the lawsuit, said she agreed with the tenor of the mayor’s speech. The schism between Evanston and the university should heal with time, she said.

“It has to be possible for the future,” she said. “We can’t be doing much worse than we are now.”

Tisdahl said she hopes the City/Northwestern Neighborhood Issues Task Force, which met Thursday, can play a key role in improving relations.

Morton said both parties need to re-evaluate their stances for any progress to be made.

“It will take courage for people on both sides of the Evanston-Northwestern divide to back down from positions and postures too often taken in anger,” she said. “But if we could rethink our downtown and then make it happen, we can do the same with our relationship with each other.”

The Daily’s Jerome C. Pandell contributed to this report.