N.J. Stat. § 27:7-21.1
Whenever the construction or maintenance undertaken by the Department of Transportation of a State highway shall result in the destruction or contamination of a well, spring, pond, reservoir or other like collection, body, store or supply of water which is necessary for the use or enjoyment of private property or public, and whenever the State Highway Engineer shall determine that the construction or maintenance by the Department of Transportation with respect to the said State highway, was the primary cause of said destruction or contamination and shall evidence such determination by a proper certificate so stating, the Commissioner of the Department of Transportation, in order to relieve the owner of a serious hardship, is authorized to compensate said owner for said destruction or contamination, or, where the collection, body, store or supply of water is used for potable water supply, to pay such part of the cost of constructing a new, or providing a substitute, potable water supply as, in the opinion of the Commissioner of the Department of Transportation, the principles of right and justice may require. The Commissioner of the Department of Transportation is authorized to make such payment only in the event that a new or substitute potable water supply is actually constructed or otherwise secured and under no circumstance shall he authorize any payment in excess of the actual cost of construction or otherwise securing a substitute potable water supply.
The State Highway Engineer shall make said determination and certification to the commissioner within 45 days, and the commissioner shall make said determination as to construction or compensation within 90 days, of the receipt of a complaint. If the commissioner fails to make a determination within the said 90 days, the claim for compensation shall be deemed to be approved and shall constitute an obligation of the commissioner to pay such claim.
If the Commissioner of the Department of Transportation denies a claim for compensation, the Commissioner of Environmental Protection, upon request of the owner, shall cause a geological investigation to be made by the State Geologist. The Commissioner of Environmental Protection shall certify the results of said investigation to the Commissioner of the Department of Transportation, and if it is certified that the State highway construction caused damage to the collection, body, store or supply of water, the Commissioner of the Department of Transportation shall make such payment of compensation.
If municipal or private water companies have water facilities and water mains within a reasonable distance from the property affected by reason of the destruction of a potable water supply so that the cost of extending the water mains to the property so affected would be less or substantially equal to the cost of constructing a new potable water supply, the Commissioner of the Department of Transportation, in lieu of constructing a new potable water supply, may pay the cost of extending such water main to the property so affected.
Any funds heretofore or hereafter appropriated to the Department of Transportation for the purpose of acquiring right-of-way may be used to make payments under this act. When several potable water supplies have been destroyed by the same State highway construction or maintenance by the Department of Transportation and the Commissioner of the Department of Transportation deems it to be in the best interests of the State, the Commissioner of the Department of Transportation is authorized to enter into a contract or contracts for the purpose of actually constructing new, or providing substitute, potable water supplies or for the purpose of extending the water facilities or laterals for the property or properties affected. Chapter 34 of Title 52 of the Revised Statutes shall apply to any contracts which may be let for any construction referred to herein or the cost of extending the water mains together with the lateral under this act unless immediate relief is required to abate a nuisance or condition detrimental to the health of the persons utilizing said potable water supplies in which case the contract may be awarded.
N.J.S. § 27:7-21.1