Despite a decade of growth, New Mexico nonprofits feel the pinch of federal cuts

New Mexico’s nonprofit sector boomed in the last decade, new data shows, though federal funding cuts have put some of the state’s nonprofit organizations in a precarious position.

Since 2013, New Mexico’s nonprofit sector expanded at a faster rate than all private industries combined, according to New Mexico Department of Workforce Solutions spokesperson Stacy Johnston. The state’s nonprofits are also some of the most reliant on federal funding in the nation, per an April report from three New Mexico foundations.

Despite the high growth rate — which Johnston attributes to the boom in nonprofit hospital employment — around 37% of nonprofits in New Mexico rely on government grants, according to the April report. New Mexico’s government, nonprofits and educational institutions received $22 billion in federal grants since the end of 2023, the report said.

New Mexico nonprofits anticipated some difficult setbacks after the Trump administration began cutting a host of federal grants and programs in January, and some of those losses have materialized, nonprofit leaders say.

According to DWS, just over 71% of nonprofit workers in New Mexico work in health care and social assistance, at organizations like Roadrunner Food Bank, which sustained losses this year due to changes at the federal level, said Katy Anderson, Roadrunner’s vice president of strategy, partnerships and advocacy.

Anderson said Roadrunner had been expecting between 30 and 40 truckloads of food from the Emergency Food Assistance Program, a U.S. Department of Agriculture initiative that distributes food to state and local organizations, when the delivery was canceled without an explanation this spring.

“What that meant for us was a loss of a couple million pounds of food,” Anderson said. “We actually ended up having to put aside some funds we weren’t expecting to replace that food.”

In 2022, there were 52,571 New Mexicans employed in the nonprofit sector, accounting for 8% of the state’s private employment, according to the DWS’s most recent data.

There were 2,890 nonprofits in New Mexico in 2022, according to DWS, a 32% increase since 2013. Nonprofits paid more on average and increased their wages at a higher rate than other private industries, the report said.

“The nonprofit sector as a whole is just really feeling the impact of these rapid, sweeping changes, and we’re doing the best that we can to remain agile,” Lindsey Kay, president of the business development nonprofit WESST, told the Journal in July.

That month, WESST announced it would close two of its offices, relocate one, and cut a quarter of its staff amid uncertainty surrounding its federal funding.

WESST could lose up to $2 million from various federal agencies, Kay said.

Many industries in New Mexico are largely dependent on nonprofits for employment. Of employees in the grantmaking and giving services industry, 92.8% work at nonprofits, and just over 90% of staff at performing arts companies are nonprofit workers.

The National Hispanic Cultural Center in Albuquerque lost a federal grant of more than $200,000, obtained through the National Endowment for the Humanities by the museum’s nonprofit fundraising arm, the NHCC Foundation, according to NHCC Executive Director Zack Quintero.

“This specific cultural center is designed to preserve and advance and elevate Latino and Chicano art, and being able to do that requires focused, long-term planning, which was what we put into this NEH grant,” Quintero said.

The money would have gone toward an effort to digitize art from Latin America and the Iberian Peninsula, he said, which will still proceed — only at a different pace than originally planned.

“It was a strong hit toward us on the financial piece,” Quintero said.