Rick, I'm the biggest dog lover you'll ever meet, and I own a (very sweet natured) male German Shepard. A free-roaming, (unrestrained), dog who viscously attacks other passive dogs in a populated area is just completely unacceptable, end of story.
I don't know what the laws are where you live, most cities and towns require dogs to be restrained/controlled. This is also for the protection of the (restrained) dog, he could get run over.
I had a similar situation years ago in Minneapolis. The neighbor's dog, (who was normally restrained), escaped and came over and attacked my dog. I got bit pretty good trying to protect my dog, it was a mess. As you know, these things can unfold so quickly that options are limited. The owner was a real young gangster type, but he was very apologetic and willing to make ammends since he knew what was at stake and cared about his dog, plus he didn't need any unwanted attention from police reports, etc., because he was on parole.
In a measured way, I explained to him that he would be paying for any medical bills related to my bite or my dog, (who was OK), and that this was his "freebie", that if his dog
ever wound up in my yard again, there would be no 'talking about it' or the like, he would simply no longer be a dog owner.
It was the type of plain language that he understood, he answered "yes sir", and dragged his dog home, never to happen again.
I would tailor the speech to the individual dog owner, but it should not vary much from that. Good luck, your safety and the safety of your family is not negotiable.
