Funds borrowed by a developer to pay for options on sites, engineering and architectural services and other preliminary expense incident to the construction of a moderate rental housing project under the provisions of this part may, subject to the approval of the Commissioner of Housing, be included as part of the cost of such project to be financed by the issuance of notes and bonds guaranteed by the state pursuant to the provisions of section 949 of the 1949 revision of the general statutes and section 8-70.