To provide funds for state grants provided pursuant to section 8-154a, the Treasurer is directed, subject to the provisions of section 3-20, to issue bonds of the state in an amount not exceeding eighty-seven million six hundred ninety-two thousand two hundred eighteen dollars. Such bonds shall be issued at such times and in such amounts as shall be determined by the State Bond Commission provided that total bond commission allocations of such amounts shall not exceed seventy-seven million nine hundred thousand dollars prior to July 1, 1977, and eighty-six million two hundred thousand dollars prior to July 1, 1978. All temporary notes and all renewals thereof issued by the state in anticipation of the issue of such bonds shall mature within three years from the date of the first of such notes to be issued. The full faith and credit of the state of Connecticut are pledged for the payment of the principal of and the interest on such bonds and notes. Net earnings on investments of proceeds, accrued interest and premiums on the issuance of such bonds shall be used first by the Treasurer for the payment of expenses incurred in connection with their issuance.