Any expense under 2500 dollars can be deducted this year and does not need to be depreciated at all under the de minimus rules. 

On the other hand, if you believe that the tenant is doing the second thing (using someone else's identity to fraudulently obtain service), and the utility company won't cooperate, then there's probably not a lot you can do in that situation unless you can prove it and/or the Housing Authority has a rule about having service in the tenant's own name and they can compel the tenant to prove that they do.Lastly, it sounds like this is a problem tenant so you should start looking into your state's requirements to end the tenancy when the lease is up, and issue the proper notice of non-renewal as soon as appropriate so that she's out when the term of the lease ends.

Where do the large and restricted dogs end up kill shelters..... 

At that point in time you get rid of him.Strict enforcement of your rules begins with new tenants. 

As others have stated, it's not uncommon to have municipalities restrict STRs.

Regarding the 1% rule, I generally turn .7 to .9%.

Question: Are there any rules against this?

Others may really like it but figured out at the viewing that you're not going to relax your rules for their pets, prior evictions, income, allowing a business, etc., so hopefully you won't hear from them again.   

My rule for rehabs have always been that I get quoted labor only costs and then I buy materials as needed in stages depending on the job.  

It seems like your open to selling in an optimal circumstance, which I don't think is short sighted at all, If the opportunity is there and it will be tax free and the rent you would be getting is sub 1% rule AND you have an idea of how to redeploy that capital to get a better return I think it's definitely something to consider.