The Metro Rail Red Line Project in Los Angeles is being planned, programmed and constructed in phases through a series of "minimum operable segments" (MOSs). The 4.4-mile, 5-station segment called MOS-1 opened for revenue service in January 1993. A 2.1-mile, three-station segment of MOS-2 opened along Wilshire Boulevard in July 1996. An additional 4.6-mile, 5-station segment in MOS-2 is currently under construction.

ISTEA Section 3034 authorized three extensions to the Metro Rail Red Line:

2. The Eastside Extension is 3.7 miles in length with four stations, originally designed as subway. It would extend MOS-1 from Union Station into neighborhoods east of downtown. The estimated cost was $1.05 billion (escalated dollars). Ridership for this extension was estimated at 12,000 daily boardings by 2010.

LACMTA and FTA signed an FFGA for MOS-3 in May 1993 which provided $1.23 billion in Section 5309 New Start funds for the three extensions of MOS-3. Subsequently, the FFGA was amended on December 28, 1994 to provide an additional $186.49 million for a total commitment of $1,416.49 million in Section 5309 New Start funding. A restated FFGA for the North Hollywood extension (Phase I-A) of MOS-3 was signed on June 9, 1997.

In January 1997, FTA requested that the MTA submit a Recovery Plan to demonstrate its ability to complete MOS-2 and MOS-3, while maintaining and operating the existing bus system. On January 14, 1998, the LACMTA Board of Directors voted to suspend and demobilize rail construction on all rail projects other than the MOS-2 and MOS-3 North Hollywood Extension. The MTA subsequently submitted a Recovery Plan to FTA on May 15, 1998; FTA approved the Plan on July 2, 1998.

In 1998, the MTA undertook a Regional Transit Alternatives Analysis (RTAA) to analyze and evaluate feasible alternatives for the Eastside and Mid-City corridors. The RTAA addressed system investment priorities, allocation of resources to operate existing transit services at a reliable standard, assessment and management of financial risk, countywide bus service expansion, and a process for finalizing corridor investments. On November 9, 1998, the LACMTA Board reviewed the RTAA and directed staff to reprogram state and local resources previously allocated to the Eastside and Mid-City Extensions to the implementation of RTAA recommendations, including the LACMTA Accelerated Bus Procurement Plan. The MTA plans to conduct further studies of transit investment options in the Eastside and Mid-City corridors.

Through 1999, Congress has appropriated $609.24 million in New Start funds for MOS-3. LACMTA plans to fund $519 million of MOS-3 with Federal flexible funds such as STP and CMAQ. TEA-21 Section 3030(a)(38) authorizes the Los Angeles MOS-3 for final design and construction.