Swarm Aero dispute exposed gaps in NDA policies
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Illustration: Gabriella Turrisi / Axios
Most Northwest Arkansas cities lack written policies governing nondisclosure agreements, according to Freedom of Information Act (FOIA) responses reviewed by Axios.
Why it matters: NDAs can protect trade secrets before a company goes public. They can also limit what residents know before a project enters the city approval process.
- Fayetteville's dispute over drone maker Swarm Aero showed how a common economic development tool can become a public-trust issue when rules are unclear.
Catch up quick: Two Fayetteville officials signed an NDA with Swarm Aero in 2023, but the company's plan for a facility near Drake Field was not public — or known by many City Council members — until a February 2026 ribbon-cutting was scheduled.
- Later FOIA requests from media and residents produced no copies of the NDAs. A city spokesperson told Axios they were not retained.
State of play: Axios requested NDA records retention policies and training materials from Northwest Arkansas' four largest cities.
- Bentonville has no city retention policies for NDAs and follows state law, staff attorney David Bailey said in an email.
- Springdale responded by department. Several cited Arkansas retention law and department-specific schedules, but did not mention NDAs.
- Rogers produced general records policies, FOIA training, social media rules and an email archiving document, but no policy focused on NDAs.
Fayetteville had no NDA-related policies until Mayor Molly Rawn established one on June 16 following a lawsuit filed by a resident over the Swarm Aero records.
- The new policy restricts when city staff can sign NDAs and sets a minimum record retention limit.
Zoom out: Act 918 of 2005 created a statewide records-retention system for Arkansas state agencies, boards and commissions. It requires them to follow the Arkansas General Records Retention Schedule for common records, including administrative, meeting, personnel, fiscal, legal and grant documents.
- It does not govern city or county records and does not directly address NDAs.
What we're watching: Whether any of the other cities follow Fayetteville's lead by adopting their own NDA-specific guidelines.
Fayetteville's NDA policies explained
The city's new rules seek to balance transparency with confidentiality.
How it works: Rawn's June 16 policy allows city staff to sign NDAs only after approval by the mayor and the city attorney.
- The documents must now be retained for five years, or until the project covered by the NDA is completed, whichever is longer.
The latest: The City Council on July 22 added more rules by ordinance.
- NDAs will now automatically end when a project enters the public process, including through a permit or license application, as a council agenda item, other city approval or the company's own public disclosure.
What they're saying: In an interview with Axios before the City Council vote, Rawn said the city needed to do a better overall job to explain "what an NDA — particularly related to economic development — is and what it is not."
- NDAs do not commit the city to spend money, approve zoning or issue permits, she said.
Between the lines: Rawn said Fayetteville had used NDAs for years without formal procedures. The goal was to set guardrails for who writes them, who approves them and how they are retained.
Yes, but: Council member Sarah Moore voted against the final ordinance. She opposed leaving NDA decisions solely to the mayor and city attorney, arguing that any exception allowing taxpayer-funded employees to conceal public business should receive public scrutiny and council approval.
- Her proposal did not ban NDAs but sought to make them rare, publicly justified and permanently retained.
The bottom line: Fayetteville made NDAs harder to sign, easier to end and more likely to be available for later public review.