Is this a scam

And I feel certain the costs would actually be higher, for several reasons, including the fact that our local construction contractors will only provide a base price for their work, which they then 'adjust' "if" they encounter things like clay, rock or water.

Sure looking like a scam to me.

That doesn't mean they were scammed.  

It's clearly a scam, but the scammer went to great lengths before launching the scam part of the transaction. 

I heard there was some companies scamming out there , how can you be scammed and does this often happen ?

That's so much less work than screwing people over every year or two, fixing the property up, and getting another tenant in there to scam again.

I contested that, and got it lowered significantly, but the tax man is going to take a MAJOR amount of your rent roll.A major problem is going to be "over assessment", I will guarantee you will encounter this and it will be a major problem.C).

This is the biggest, strangest mess that I have even encountered in 20+ years of doing real estate investing.

I go as far as to provide a copy of my license and POR so that there is no risk of scam involved.