Meanwhile, federal funding for the local program expired Dec. 31, and the national Head Start Bureau in Washington, D.C., has yet to renew its 2004 funding for the Berkeley-Dorchester Counties Economic Development Corp.

Berkeley-Dorchester EDC is the private, nonprofit agency that oversees Head Start programs in Charleston, Berkeley and Dorchester counties. The agency has an annual budget of about $11.5 million, nearly all of it federal money, to run about 20 Head Start centers serving about 1,400 low-income children in the tri-county area.

Thomas Myers, executive director of Berkeley-Dorchester EDC, declined to answer questions Wednesday. Paul Tecklenburg, the Charleston attorney representing the agency, was out of his office and could not be reached. Head Start officials in Washington did not return repeated telephone calls seeking comment.

Even though the agency has yet to receive federal funding for Head Start this year, Berkeley-Dorchester EDC employees said all local Head Start centers remain open and operating normally.

In addition to Head Start funds, the agency receives grants to administer other programs for low-income residents, including help with food, transient housing, day care and electric bills.

Berkeley-Dorchester EDC has been under fire since two audits last year concluded that since 1998 the agency received $7.4 million more in grant money than its enrollment allowed.

The audits also identified more than $3 million in other irregularities, including building renovations that were paid for but not completed.

The FBI and the U.S. Attorney's Office would not comment about next month's grand jury probe, but sources told The Post and Courier that authorities will issue subpoenas soon in connection with the inquiry into the agency.

Special Agent Steve Grimaldi of the Charleston FBI office said he doesn't know when his agency's investigation into Berkeley-Dorchester EDC will be finished.

"The investigation is going well, and we are happy with the progress," Grimaldi said. "We don't have a timeline for completing it."

Berkeley-Dorchester EDC could lose control of the tri-county Head Start program if it does not account for the missing money. Agency officials have denied any wrongdoing and assert that no grant money was misspent.

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