When used to describe other localities, regions or states, specifically New Jersey, it emphasizes the amount of shit that other states and/or organizations place, throw or otherwise dump on the aforementioned location. One can also correctly use this word for comparison purposes- i.e. "This place has half the shittiness ratio of New Jersey," which roughly means that the residents of such an area suck balls and lick choads for a living.
Meaning: Colorado fucking rules and New Jersians love to smoke pole, eat shit and die. There is also a subtle undertone of "Oregon sucks."