Declining enrollments and fiscal stringency in the 1980's and 1990's must be met by a new management style if higher education in California is to maintain quality and meet the educational needs of the public. Unlike the situation in the 1960's and 1970's, higher education is now faced with a no-growth situation brought about by: (1) fewer young people in the 18 to 24 age group, (2) fewer high school graduates in proportion to the total number of high school students, and (3) a drop in the rate in which potential students decide to enroll. This no-growth situation will not be substantially altered by the increasing enrollments among minority and older groups. The results may be decreased resources distributed on the basis of enrollment and the underutilization of facilities. Fiscal trends in the wake of Proposition 13 will necessitate an increase in the percentage of funds provided by the state and, thus, a change in budgeting procedures. The formula, for example, by which state funds were apportioned to community colleges on the basis of enrollment and district relative wealth, had to be changed after Proposition 13 undermined local revenues. Given the likelihood that fiscal reductions will continue, management must place more emphasis on review and evaluation of existing programs and legislators should allow educators the latitude to develop these new management procedures. (JP)