First off, it appears that the dog's behavior is a result of cruel owners. A little dog, tied up all the time with no freedom to be a dog, would make any dog bored and stressed enough to bark and growl. Maybe even unbalanced. I feel TERRIBLE for it, and angry at the owners.
And I feel terrible for you too. It would be awful to live next door. I so hope a knowledgeable person will read your post and know just how to handle it. Surely someone does. TOTV is a great place to start.
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