Septic Diverter Valve failed - Questions

I have a 25 year old septic system in the San Francisco Bay area on a moderate hill with the diverter valve about 10' to 15' lower elevation than the top of cement septic tank. Recently I noticed a wet area around the hatch cover for the second chamber of the tank. It had not been wet for more than a week. I looked at the diverter and saw standing water (top of valve is about one foot under ground in a small well with wooden side walls. I checked the slide valve that was supposed to be open and it felt like the push-pull control rod was no longer connected to anything. I opened the other valve and heard a rush of water. The area above the tank is no longer wet. The area in the diverter box no longer has standing water, but has wet black mud. There do not seem to be any backup problems inside the house.
I believe that all I need to do is replace the diverter. I have had 2 contractors look at it with an estimate of $500 to a quote of $950. One gave a quote of $600 over the phone with the information that the top of the valve was 1 to 1.5 feet under the ground level.
1) There is a big variance in costs. Does this seem right?
2) The existing valve is a plastic with the inlet on the North side and push-pull slide gates on the West and South outlet sides. The cheaper prices were to replace the valve with the same/similar one. The $950 quote was to replace this with stainless steel with an inlet on the North and outlets on the West and East (and additional pipe-routing). The stainless valve sounds like overkill. Any comments?
3) One contractor said that the water at the diverter valve must have been there for along time to get the black mud. The others did not comment. I don't believe (but am not sure) that this has been a long term condition. Any comments?
Thanks for any help,
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