"It defies belief that property owners could not have been aware," says one source who himself heard of valuation discrepancies as high as 20%. "Very simply, if you are a sophisticated property owner, you know everything about the properties that compete with you. Assessments are all a matter of public record. It's hard to believe you would not be suspicious of an assessment lower than yours on a building situated similarly to yours."

Another assessor who works in Manhattan says he's witnessed valuations with discrepancies as high as 50%. "We've lost business over the years because we tried to do things the right way," he told GlobeSt.com under condition of anonymity. "The city turned a blind eye toward the undervalued assessments but delayed legitmate firms that tried to work within the system."

"Considering the length of time that the alleged pattern of bribery took place and the widespread nature of the situation throughout Manhattan and other boroughs, one would be hard-pressed to believe that the scandal is limited only to consultants and occurred without the knowledge or perhaps the acquiescence of property owners," another source reflected.

It is estimated that the alleged assessment conspiracy cost the city on the order of $40 million in tax revenues and could range as high as $160 million. Some 500 properties were involved in the scheme, although no building owners were named in the US District Court indictments.

"It's not very conceivable that many owners will be involved," says Real Estate Board of New York president Steven Spinola. "Al Schussler [indicted for allegedly paying out bribes for reduced assessments on properties he controlled or represented] is an extremely knowledgeable tax person. Truth is that many of my members hired Al and others to do what they felt was needed to do to represent their properties. Keep in mind that this is an indictment and not a conviction."

Spinola also takes issue with the breadth of the reports. "I don't know if there are 500 properties that were under-assessed. You can probably bring in experts who say they were not. In terms of the economic impact, I don't believe anywhere near the amount that has been written. Assessments are not a science."

David Levinson, vice chairman of Insignia/ESG echoes that faith in the scruples of his peers. "I'm in the industry 27 years, and [Schussler's] name comes up all the time as the best in the business. I never heard anything even close to him doing something like this. As they go through their investigation, owners will come away clean." According to published reports, 9 W. 57th St.--the Solow Building, for which Insignia is agent--was among the buildings where assessments are being questioned.

According to a spokesperson for S.L. Green, some three or four of Green's buildings are also involved. The representative would say only that the company "knew nothing of any improprieties with respect to the assessment procedures in their buildings."

If sources are right and more indictments are likely in the short term, the long-range upshot is likely to be local-industry reform. "This is not the first time tax assessors have been accused of improprieties," says John Garippa of New Jersey-based real estate law firm Garippa, Lotz & Giannuario and president of the American Property Tax Counsel. "Cases like this have broken out in other places around the country. The natural outgrowth will be that there will be a review by the courts of whether or not the tax consulting function should come strictly within the purview of lawyers. This is done for a very good reason, namely, lawyers are licensed by the Supreme Courts of those states. At a bare minimum, there should be certification for assessors."

According to Jenkens & Gilchrist Parker Chapin attorney Mitchell S. Berkey, "the end result of the investigation would restore whatever credibility has been lost in our tax assessment systems. To restore that credibility, greater oversight may be necessary.