If I were you, I would shoot that Coyote asap! It will be back! Make sure you go out and check first before letting the pups out. AND make sure you go out WITH the gun!
We have coyotes here in Maine too but they have kept a little distance and didn't try anything so bold. However, years ago they did get my neighbor's cat right in the middle of the day. My neighbor was in the house, heard the cat scream and saw the coyote take off with it through the kitchen window.
I keep hoping and praying that the wolves move back into our area as we are pretty close to Canada. The coyotes will leave if the wolves come, and they are not as brazen.