N.J. Stat. § 13:12-14
The canal and banking company is hereby authorized to consent, under restrictions which shall not impair any existing rights, and for a consideration in each case to be fixed by its board of directors and approved in writing by the governor of this state, to the diversion, for the purpose of municipal water supply, of the waters or any portion thereof, the title to the right to the use of which is vested in the canal company in trust for the state of New Jersey; but nothing in this section contained shall be construed to dispense with any consent at any time required to be obtained by any municipality, board or commission as a condition precedent to the diversion of the state's waters or to the development of a municipal water supply.
N.J.S. § 13:12-14