The situation is still unresolved. I managed to get better info from local media - here's what I know now:

• This whole thing started at 7 pm or so last night. The hostage taker was out of jail on a 1 day furlough, and went to a bar/cafe - probably in search of his ex-wife. He found his ex mother in law and ex sister in law instead, who had his kids with them
• There was some kind of ugly argument at the bar, and the police were called. A police woman showed up, and the perpetrator took out his gun and shot her - fortunately a slight wound to the arm
• That's when things went to hell - she called for backup, and he grabbed his hostages - the two women and the kids. At some point, the kids were let go
• I don't know whether he has a grenade - that was reported, but I had not heard of the gun earlier. Multiple policemen have told me he has a grenade
• Ironically, this guy was in jail for taking his family hostage!
• Apparently, the police are no longer releasing news updates of any kind - the perp has been monitoring news reports, and gotten angry about things he thought were wrong. So... no press conferences, etc.

That's what I know now. I'll have to see what new info - if any - turns up tomorrow. The only thing I have left is pure speculation, but here goes - I have a very bad feeling about this. The longer this goes on, the more likely it is (IMHO) that this guy will convince himself that "it's too late to go quietly". At that point, either the police use snipers to take him out, or he ends the whole thing violently himself. Again, that's pure speculation on my part - above this paragraph is stuff I'm reporting based on actual sourcing.