1,148    tax-exempt organizations are headquartered in Santa Fe, according to the IRS, with a combined income of $1.3 billion.

"[U]nder-giving by the rich might be due to a lack of empathy, rather than meanness or financial illiteracy. As Rousseau suggested…the lives of the rich are so far removed from the lives of the poor that they lack any common fount of shared experience."—British philanthropy researcher Beth Breeze, describing the findings of her recent study, “Feeling Poor, Acting Stingy”

Santa Fe famously loves its nonprofits. But not quite enough in this recession.

"What's likely to happen is some nonprofits will simply shut their doors," Robert Apodaca, executive director of the New Mexico Community Foundation, says. "But, much like in the private sector, there's going to be mergers."

Billie Blair, president of the Santa Fe Community Foundation, a separate organization, says her group recently brought together directors and board members from 47 local nonprofits to examine "the possibilities of collaborations to partnerships to outright mergers." Four sets of those organizations, Blair says, have merger potential.

Because they usually rely on private donations and government contracts, nonprofits aren't immune from the wider market. Larger grant-making organizations keep much of their money invested in endowment funds, siphoning off a bit for grants to smaller groups.

SFCF's endowment fell 21 percent last year, Blair says, compared to the 30 to 35 percent declines in foundation endowments nationwide. Apodaca says the NMCF's endowment fell 28 percent.

That means less money trickling down to New Mexico's 10,406 tax-exempt organizations.

There are 112 Santa Fe nonprofits with $1 million or more in annual income, and 24 nonprofits that bring in $10 million or more. Approximately half bring in $25,000 or less. "Really hard-hit were organizations that feed the hungry and shelter the homeless," Blair says.

At The Food Depot in Santa Fe, demand has risen 20 percent, while rising food and fuel costs have taken a toll. When The Food Depot started buying truckloads of food from wholesalers three years ago, a shipment cost up to $25,000. Now, the same truckload costs up to $40,000. "We rarely have enough donations to meet the demand," Executive Director Sherry Hooper says.

On the bright side, the feds are supplying more USDA commodity foods. And while foundation contributions for operating expenses will decrease, smaller individual donations are up, Hooper says.