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President Obama is calling for major changes to a key program from the government's War on Poverty back in the 1960s. Head Start is supposed to get at-risk children prepared for school. The president says too many children aren't learning and too many programs are mismanaged.

PRESIDENT BARACK OBAMA: We're not just going to put money in the programs that don't work, we will take money and put them in the programs that do.

SIEGEL: The administration has released a list of 132 Head Start programs that are rated deficient. Those programs must now compete for federal funding.

NPR's Claudio Sanchez reports that the list includes one of the first Head Start programs in New Haven, Connecticut.

CLAUDIO SANCHEZ, BYLINE: When Kathy Harvey heard that New Haven's board of education could lose its $6.2 million federal grant to run the city's Head Start program...

KATHY HARVEY: It freaked me out when I first heard about it. But it only freaked me out for about five minutes.

UNIDENTIFIED CHILD: Hello.

UNIDENTIFIED WOMAN: Hi, cutie.

SANCHEZ: Harvey runs the Zigler Head Start Center, a welcoming, brightly lit building plastered with kids' drawings that Harvey usually loves showing off. But it's hard putting on a happy face after you've been labeled deficient.

Harvey says she feels beleaguered. Although it's not something she lets parents see or get in the way of meeting the every day needs of children, like 4-year-old Anthony.

HARVEY: Hi, Anthony. You need a treatment?

Anthony is about to go outside. And so on days that he's a little wheezy, we give him two puffs of Albuterol.

Anthony, ready?

(SOUNDBITE OF AN INHALER)

SANCHEZ: This is why Head Start is more important than ever, says Harvey. The demand for what Head Start provides is growing - medical care, eye and dental exams, three meals a day, academic instruction and training for parents. The Obama administration may not agree but 'we do good work here, says Harvey.

HARVEY: Obama wants all Head Start centers in the country to go up for re-competition or whatever it is? Bring it on.

SANCHEZ: Actually, the last time inspectors from Washington, D.C. came to New Haven, they found that from 1980 to 2001 the Board of Education hired at least 10 people to work for Head Start without conducting criminal background checks. Inspectors also found half a million dollars worth of billing and financial errors.

Tina Mannarino, the supervisor of early childhood education in New Haven says those problems have since been corrected.

TINA MANNARINO: So we are in full compliance now.

SANCHEZ: The U.S. Department of Health and Human Services confirmed that New Haven was in compliance. But the director of Head Start in Washington, Yvette Sanchez-Fuentes, says that doesn't mean it's off the list of programs with a history of deficiencies.

YVETTE SANCHEZ- FUENTES: We determined that they'll have to compete to continue to receive their Head Start funding.

MANNARINO: Although we feel it's unfair, we do embrace re-competition as an opportunity to improve quality and effectiveness.

SANCHEZ: Mannarino says that's all New Haven can do. Critics of Head Start say it's about time.

DAVID MUHLHAUSEN: Its time for new thinking.

SANCHEZ: David Muhlhausen is with the Heritage Foundation, a conservative think tank.

MUHLHAUSEN: To the Obama administration's credit, if their proposed reforms are actually carried out, then I think that it would raise the accountability for Head Start.

SANCHEZ: Today, says Muhlhausen, the $8 billion program is riddled with problems - financial fraud, shoddy record-keeping, doctored documents that have allowed ineligible families to enroll. Besides, says Muhlhausen, studies show that many children don't benefit academically from Head Start. So, maybe it's time to turn the whole thing over to the states.

MUHLHAUSEN: We're wasting a lot of money on this program. And it's a shame. But I think if we devolve the responsibility back to the states and let states the try a diversity of ideas, we'll find better approaches and will end up doing better for these kids in the long run.

SANCHEZ: And if states can't do it, Muhlhausen says, other groups, including for-profit organizations should get a shot.

MUHLHAUSEN: For the administration's plan to work, there has to be competition. And that means there have to be alternative providers.

SANCHEZ: Easier said than done, says Dr. Edward Zigler, professor emeritus at Yale University and the man some consider the father of Head Start.

EDWARD ZIGLER: Who's waiting in the wings to take over that program? Nobody is talking about that. I don't know where these people get that in their heads.

SANCHEZ: Zigler helped design Head Start in the mid-1960s. He says inadequate funding has hurt the quality of the program more than anything else, because with enough money you can hire good teachers and competent administrators, and pay for top-notch health services and facilities.

ZIGLER: It's always a matter of money. It's been a matter of money for 46 years.

SANCHEZ: Zigler is hoping the government's scrutiny will reassure lawmakers in Washington and result in more funding for Head Start.

(SOUNDBITE OF CHILDREN)

SANCHEZ: But in New Haven, the scrutiny has aroused indignation. Dr. Michelle Bogart runs the Lincoln-Bassett Head Start Center for disabled children in one of the city's most impoverished neighborhoods.

DR. MICHELLE BOGART: You come here and tell me what else we can do.

(SOUNDBITE OF LAUGHTER)

BOGART: We have eight hands and we do 24 hours worth of work and love and support and compassion and education in six and a half hours. What else can we do?

SANCHEZ: In the fall, New Haven will find out if it can keep its Head Start grant or not. But already, community organizations in Massachusetts and Ohio are threatening to sue if the Obama administration goes forward with its plans to pull funding from programs it considers deficient.

Claudio Sanchez, NPR News.

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