N.J. Stat. § 13:17-40
All land within the district shall be divided by the commission into 3 classes as follows:
Class 1--Land owned by the State of New Jersey, any of its political subdivisions, or any other public agency or instrumentality which enjoys the privilege of general property tax exemption under the laws of the State, and which land is designated by the owner as presently or ultimately intended for a public use.
Class 2--Land owned by the State of New Jersey, any of its political subdivisions, or any other public agency or instrumentality which enjoys the privilege of general property tax exemption under the laws of the State, and which land is designated by the owner as ultimately disposable to private ownership, or usable by private parties.
Class 3--All other land.
N.J.S. § 13:17-40