That one is a no starter, just a threat.

PMs are usually guarded about working with arbitragers and rightfully see them as a competitive threat.

I know of at least two occurrences where the investors had to move the properties back to personal ownership under the lender's threat of acceleration of the loan.For the legal and tax side, I'm neither an attorney nor tax professional.

How should I respond without seeming like I'm only replying because of their threat?

You need to do a SWOT Analysis of yourself--what strengths, weaknesses, opportunities and threats face you on your journey and in between you and that community defined end state for the real estate.  

However Property tax's some of the lowest in the coutnry and property maintenance same thing if you buy a stucco home with a tile roof.No real major weather threats like many markets  IE hail storms wind storms etc.. can get windy but thats common.. 

Although the internet is great in theory, there are major cyber security risks with it.

Although we offer payment plans, those who acceptthem do not follow through with them,” wrote LIHI, which develops,owns and operates housing for low-income, homeless and formerlyhomeless people.Itreceived $750,000 of city aid.Evictionis often an empty threat, noted LIHI’s application.

I am wondering if we have the grounds to pursue any legal recourse if the PM company refuses to take accountability for the existing property damage (dead grass) and potential threat of an unsecured property.Your advice/opinion is greatly appreciated.

If the non profit continues with the threat of litigation, threaten it with a counter lawsuit for filing a frivolous lawsuit.