SAN FERNANDO — Nearly two years after county officials threatened to take over its mismanaged Head Start program, the Latin American Civic Assn. has emerged as a leaner, more efficient organization, providing meals, health care and instruction to hundreds of poor children in the San Fernando and Santa Clarita valleys, authorities monitoring the group report.

LACA--which violated federal spending guidelines in 1992 and later lost a critical $600,000 state grant to run preschool programs--has yet to make a full recovery. But the group's steady reorganization progress has satisfied officials at the Los Angeles County Office of Education, which contracts with LACA to run the federally funded national Head Start program.

"I really think (county officials) didn't think we were going to make it," said Irene Tovar, a LACA founder who took over as executive director in a major management shake-up. "There was a serious commitment to the children. Under no circumstances were we going to let down the children."

Steve Horowitz, a spokesman for the county education office, said in a written statement that LACA has made "significant progress," and that county officials would work with the agency to continue to strengthen its operations.

"The county will continue to help LACA complete all obligations that were under review, including finalizing all past financial obligations," Horowitz said.

The regional office of the Administration of Children and Families--which oversees the Head Start program for the federal Department of Health and Human Services--recently evaluated LACA to make sure it was in compliance with federal regulations.

The results of that review will not be released until next month, but LACA and county officials expect a positive report.

"As highlighted in the federal review, LACA was found to have performed outstandingly well in the areas of social service, parent involvement and fiscal management," said Horowitz, who has reviewed a draft of the federal findings.

The positive outlook culminates nearly two years of turmoil that nearly led to the demise of the San Fernando community institution that had been the sole Head Start provider serving mostly poor preschool children in the two valleys. In the aftermath, LACA no longer will hold a monopoly over such programs in the region but remains determined to serve its largely Latino clientele, Tovar said.