Yes, this is terrible. But child services should only be called if the child's PHYSICAL LIFE IS IN DANGER.

Having child services called is very hard on the child. Yes, of course the child's current situation is bad, but again... I believe that unless you think the child is in physical danger, that it is a last resort. You run the risk of the judge deeming both your sister, and the grandma of being unfit to care for the child... Then, you are chosen to care for the child... But, if one little thing goes wrong- such as the case worker finding an exposed electrical hazard in your home during the home inspection, or some other minor, easily fixable violation... It is still a violation, and the case worker can't allow the child in your home until it's fixed... But the case worker has a million other cases, and is sometimes quite incompetent, and can't come back for another home study until 2 weeks from now. Where do you think the child will go in the meantime? Foster care. I'm sure you've heard all the horrific tales about temporary foster care "guardians". I would never want to risk that with a child, UNLESS I believe that the child's physical life is in danger. And from what you wrote, that doesn't seem to be the case.

I would threaten your sister with it (which I'm sure she wants to avoid that nightmare), unless she seeks counseling and parenting classes. There are LOTS of free parenting classes out there. Maybe that can help. If she refuses, then I'd consider taking it to child services if things don't improve, and you fear the child's life is in danger.