N.J. Stat. § 27:7-20
If, in the judgment of the commissioner, the co-operating board, body or person could obtain more advantageous prices for the work and the best interests of the state would be served by having the co-operating board, body or person award the contract for the work, the commissioner shall approve the drawings and specifications of the co-operating board, body or person and shall approve the contract for the work, and may, subject to the consent, in writing, of the state house commission, enter into an agreement in writing to pay the co-operating board, body or person such portion of the cost as the state highway commissioner may deem advisable.
Payment on the part of the state shall be made only after the state highway commissioner shall have approved the certificate of the inspector and engineer in charge of the work that it has been satisfactorily completed, in whole or in part, according to the contract, drawings and specifications.
If the co-operating body is a public utility corporation under the jurisdiction of the board of public utility commissioners and the work is to be done without contract by the employees of the corporation, the state highway commissioner may waive the requirement as to approval of the contract for the work.
N.J.S. § 27:7-20