Например, можно так:
$fh = fopen("file.csv", "r");
while (false !== $row = fgetcsv($fh, ...)) {
    foreach ($row as &$rowItem) {
        $rowItem = mb_convert_encoding($rowItem, "utf8", "cp1251");
    }
    unset($rowItem);
    ...
}
fclose($fh);
P.S.
Toster Driven Development