SECTION 1. There shall be a commission to study the distribution of general local aid in the commonwealth, including unrestricted general government aid, lottery aid as promulgated 394 in section 18C of chapter 58 of the General Laws and additional assistance aid to municipalities. The study shall not include foundation aid as defined in section 2 of chapter 70 of the General Laws.

SECTION 2. The commission shall examine the current formula used to distribute unrestricted general government aid to municipalities, evaluate the effectiveness and equity of said formula and make recommendations to establish a more equitable distribution of unrestricted general government aid to municipalities in the commonwealth. The commission shall review all aspects of general local aid including, but not limited to (a) the current allocation of local aid to municipalities; (b) the reflectiveness of municipalities’ needs in the proportional distribution of the unrestricted general government aid formula; (c) any equity disparities that exist between municipalities across the commonwealth related to local aid distribution; (d) the ability to account for a municipality’s change in population or tax base in a general local aid funding formula; (e) the potential to calculate municipal costs based on a municipality’s need for municipal services and a municipality’s ability to raise local revenue, less a municipality’s local revenues; and (f) any alternative formulas that may create a more equitable distribution of general local aid.

SECTION 3. The commission shall consist of: the secretary of administration and finance, or a designee; the commissioner of the department of revenue, or a designee; 1 member appointed by the state treasurer; 2 members of the senate, 1 of whom shall represent a gateway municipality as defined in section 3A of chapter 23A of the General Laws and shall serve as co-chair; 2 members of the house of representatives, 1 of whom shall represent a gateway municipality as defined in said section 3A of said chapter 23A and shall serve as co-chair; 5 members appointed by the governor, 1 of whom shall be nominated by the Massachusetts Municipal Association, Inc., 1 of whom shall be nominated by the Federal Reserve Bank of Boston, 1 of whom shall be nominated by the Massachusetts Budget and Policy Center, Inc., 1 of whom shall be nominated by the Massachusetts Taxpayers Foundation, Inc., and 1 of whom shall be nominated by the Edward J. Collins, Jr. Center for Public Management at the University of Massachusetts at Boston.

SECTION 4. The commission shall file a report of its findings and recommendations, including any new or revised local aid formulas, with the clerks of the senate and house of representatives, the chairs of the senate and house committees on ways and means, and the senate and house chairs of the joint committee on municipalities and regional government not later than March 1, 2020.