Notwithstanding the provisions of sections 7-378a and 10-56 and any other public or special act or charter or bond ordinance or bond resolution which limits the renewal of temporary notes issued in anticipation of the receipt of the proceeds of bond issues to four years from the date of the original notes, any town, as defined in section 7-378, or regional school district may renew temporary notes in accordance with the provisions of this section for an additional period of not more than four years from the end of such four-year period immediately following the date of the original notes. The officers or board authorized to issue the bonds or determine the particulars of the bonds may adopt a resolution authorizing the renewal of temporary notes for such additional period under the following conditions: (a) All project grant payments received shall be promptly applied toward project costs or toward payment of such temporary notes as the same shall become due and payable or shall be deposited in trust for such purposes; (b) no later than the end of each period of twelve months after the end of the four-year period immediately following the date of the original notes a portion of such temporary notes equal to at least one-twentieth of the town’s or district’s estimated net cost of the project shall be retired from funds other than project grants or note proceeds; (c) the interest on all temporary notes renewed after such four-year period immediately following the date of the original notes pursuant to this section shall be paid from funds other than project grants or note proceeds; (d) the principal amount of each bond issue when sold shall be reduced by the amounts spent under subdivision (b) of this section, and the principal of such bonds shall be paid in annual installments commencing no later than one year from the date of issue; and (e) the maximum authorized term of the bonds when sold shall be reduced by not less than the number of months from the end of such four-year period immediately following the date of the original notes to the date of issue. For sewer projects the annual payments required under subdivision (b) of this section shall be at least one-thirtieth of the town’s estimated net cost of the sewer project. Any federal or state grants which are to be paid over a period of years to reimburse the town or district for a portion of principal due on bonds or notes may be used in computing the town’s or district’s net cost of the project. Any town or district in which such resolution is passed shall include in its annual budget or shall otherwise appropriate sufficient funds to make the payments required by subdivisions (b) and (c) of this section. This section shall not relieve any town from complying with the provisions of section 7-378a in renewing temporary notes for a period of not more than four years. In no event shall any notes renewed pursuant to the provisions of this section be due and payable later than June 30, 1984.