HIGHFILL, Ark. (KNWA/KFTA) — UPDATE: The Northwest Arkansas National Airport could separate from the town of Highfill. Senate Bill 414 passed the Arkansas Senate committee on March 29.

It would allow regional airports to annex or detach from their cities.

HIGHFILL, Ark. (KNWA/KFTA) — The Northwest Arkansas Regional Airport is considering deannexation from Highfill, a decision that will heavily impact the future plans for both the city and the airport.

Highfill is a small town, only holding around 2,500 residents. Highfill mayor, Michelle Rieff, said there’s hardly any business or industry within city limits to generate sales tax. Most of the sales tax revenue comes from the airport.

Rieff estimates around $500,000 in tax revenue going to the city annually. XNA officials, however, estimate that number could be anywhere between $500,000 and $1 million.

The city has a $4 million budget. Rieff said losing the annual sales tax could be catastrophic for the city.

“This is a fact-finding mission. They are also going to research the effect this will have on the city of Highfill. A couple of their board members were very concerned and they wanted to know that too,” said Rieff.

If XNA separates from Highfill, residents could be impacted. The city may have to raise wastewater and water rates, as well as cut back on some services the city offers. Highfill officials were also looking to improve some roads, but that may not be possible.

“I would say, don’t panic, let’s be helpful. Let’s see how this pans out,” said Rieff.

Meanwhile, Rieff is hopeful more businesses will consider opening up in Highfill.

“There’s been talks of some major industries coming, and the airport has worked with us on that, but that hasn’t happened. Something like that could be our saving grace, maybe,” said Rieff.

The city also has over $7 million in bond debt that has to be paid off in part each year. That’s over $700,000 more that the city has to pay each year.

However, the deannexation could mean big things for XNA’s future. The public affairs manager, Alex English, said keeping that large sum of revenue in-house could allow them to start up significant projects that will improve the airport.

“The initial intent when the authority was formed, was to be an unincorporated area in the county. So, it’s been a conversation we’ve had kind of on and off over the years,” said English.

XNA wants to make sure the deannexation makes sense. It isn’t something that will be decided immediately.

“Our number one focus as the authority is, customer experience and making sure that the airport is looking out for passengers and benefitting the region as much as we can,” said English.

According to English, the airport already provides its own municipal needs when it comes to fire and police. XNA is hoping the new XNA road, which will pass right through Highfill, will bring more opportunities for the city.

“I think it’s inevitable that growth is coming out this way. We see it all the time, especially with new projects, new zoning around the airport,” said English.

The XNA board is set to meet in December to discuss the potential deannexation further.