[Pond, James Pond]

If the dog will snap at kids and is showing that much aggression, it has no business running loose period.

I think I'd be having a heart to heart with the neighbor BEFORE something happens. If the neighbor is less than receptive during the talk, I would not hesitate to call the authorities

This.

Prevention is always best. It guarantees a better outcome, keeps you happy as you and yours are safe and keeps you neighbour happy (because his dog doesn't take a bullet).

Talking to the authorities documents that there is a potential issue, in case the worst were to happen, shows you are trying to do the right thing and tells you where you stand.

I have had an issue where a Staffordshire Bull female has thrice had a pop at one of my dogs. Each time the Staffy has been off-lead which is not permitted but often ignored. The last time it happened, the dog went off when its owner called, but not before I'd punched in the side of the head to get it to move off.

I went to the police asking what my options were, making it clear I didn't want to shoot this dog. They confirmed pepper-spray was the best option. If I need to use it, I can now say I had approval from the police for this kind of action.