This paper proposes that a more flexible approach to the development of teaching groups, accompanied by the necessary changes in staff and facility utilization, would help solve problems arising from declining enrollments in elementary schools. Such problems presently occur in many elementary schools in Western Canada. The problems of educational planners in dealing with declining enrollments are examined in terms of school organization, staff utilization, and the utilization of facilities. Proposals especially appropriate for elementary schools with less than 150 students in eight grades are illustrated in four models for classroom grouping. Two models assume that teachers can develop teachable groups and a variety of activities; that students can benefit from extensive individualization of curriculums and changeable groupings; and that school facilities can be modified to allow for a variety of groupings. Two other models are more traditional, suitable for schools whose physical structures are not easily changed. Implementation of these proposals could improve the quality of education in areas of declining enrollment, while keeping costs down. (Author)