Cats, Dogs, and Neighbors - not a Good Formula

I live with two room mates and three cats in a modest neighborhood where most houses are detached single family ranch homes.  Shortly after I moved in I had my first encounter with my neighbor's dog. As I was sitting outside, she came into my yard barking and trying to force me into the house.  I did not know what to do so simply stood my ground, but ignored her.  Regardless, she kept at it and only vacated the driveway when my room mates came back in their car - after about an hour.

You may also think that dogs only bark at those who fear them - it is a story I have heard often when confronting neighbors to let them know if they could please not let their dogs run loose and to stop them from invading everyone's property (many houses do not have fences).  However, believe me I do not fear this little black fluffy Pomeranian.  She would actually be cute if it was not for her incessant barking and roaming.

It is not just that she roams, she thinks every one else's yard is her property and I see and hear her barking at everyone, trying to get them to get off their own property.  This has been going on since I moved in.  I can't confront the neighbor as I do not own the house I live in, my friend (I use that term loosely) owns it.  I have asked him to say something to the neighbor, but he won't.  He sees nothing wrong with pets being outside, he lets his own cat (Annie) out and mine (Gracie), even though I have asked him not to.

Well, earlier today I heard a commotion outside - barking and yowling.  I was home alone, so I opened the door and there was Roxy (the neighbor's dog) in front of my steps, while my room mate's cat cowered underneath the steps.  When Annie (the cat) saw me, she quickly darted into the house.  Annie does not like anyone and is very anti-social - even for a cat - but this time she looked at me with gratitude.  Roxy then proceeded to bark and growl at me.  I yelled at her to get out of my yard, but she would not leave. I then walked towards her, raising my cane and shouting at her (no lie I really do walk with a cane).

She finally went into her own yard, but kept barking.  Regardless, I decided to leave her be (I am not a mean person) and as I turned around, I noticed the neighbor's girl friend.  She must have heard the commotion.  I don't know what came over me, but I shouted at her: "Your dog attacked my cat!"  I mean, Annie is not even my cat!  The neighbor yelled "sorry," but I just went into my house and slammed the door.  What a sight I must have been - a towel on my head (I had just gotten out of the shower) and waving a cane.

I am more upset about my neighbor that he lets his dog roam at all hours, than I am at the dog.  Our city has a leash law.  If I was mean, I would simply call animal control.  But, the catch is that we have cats that go outside - even though it's not what I wish.  So, they could turn around and call animal control on us. I have told my house owner all of these things, but he still insists animals are happier outside and that it is cruel to not let them out. Luckily my cat comes when I call her but I have to do that all the time, so my neighbors know.  What to do? Move? While my cat is small, my budget is tinier - so that is difficult, although I am looking.  Too bad that people have to be so irresponsible.