Enrollment projections for the 1980's need to be based on at least seven variables; the size of the 18-to-24-year-old cohort; the rate of participation of that cohort; the rate of participation of nontraditional students; the full-time/part-time ratio of participation; the division of participants among public, private, and proprietary institutions; the appropriations for public student aid; and the interstate movement of students. Based on these factors, this study considers the management of the enrollment decline and the priority for the public sector. A delivery system is proposed that is based on a performance formula applied to a system of public higher education in which students share in the expense of actual instruction and all other expenses associated with delivering instruction. A method for determining the percentage of state subsidy to the student is described, and three performance strategies for declining enrollment are detailed. It is concluded that the state subsidy must take account of overall state concerns and the desire to gather funding from federal student aid programs. State practices in student aid can be regularly adjusted according to changes in the federal government. (LBH)