I am not an attorney and I do not play one on tv ...
I read through the blog post yesterday (only 2 pages at that point) and the entirety of the very sparse Tilia website. Indeed, while an "inactivity fee" to the "extent permitted by applicable law" is suggested, there is no posted "fee schedule" as referenced in their ToS. I would expect this fee to be similar to that of a pre-paid debit or gift card (a "stored value card"), intended to draw down the balance of funds on inactive cards. The CARD Act of 2009 might give some relevant protections, as well as state law; I am unclear which state's law Tilia may use for this purpose (ie. California is used for governing law, but California generally does not allow gift card fees or expiration dates, so it is possible that another state's "money transfer agent" or "payment processing service" laws are being used by Tilia). The CARD Act does specify that fees must be disclosed in advance (see, "fee schedule") and that cards may not expire less than five years from the last active date.
A "good intent" reading of the blog post suggests that nothing really changes for SL. Only US $ accounts are affected. Tilia administers these US $ accounts. Due to US "know your customer" financial compliance regulations, Tilia will act more like a traditional bank (Tilia, like Paypal, it not a "bank") in this regard, and will require more detailed personal information before US $ funds may be withdrawn from SL into "real" money, ie. "process credit" to Paypal or Skrill.
This "process credit" fee was recently doubled, effective 24 June, from 2.5% to 5.0%. I suspect that this foreshadowed the impact of Tilia's entrance. Recall, LL said this increase was to offset, "increased regulatory and compliance costs", ie. Tilia.
LL states that Tilia only affects US $ funds and "process credit" transfers of US $ funds out of SL. This should not affect US $ purchases of L$ or L$ account balances.
Sudane, please correct me if anything I state in the following paragraph is incorrect:
In CDS, we maintain only a relatively small US $ account balance, sufficient to pay LL our tier; the balance of funds remains as L$. Each month, we pay Rudeen L$ via the parcel tierboxes, then Rudeen converts the L$ sum required to pay LL tier in US $. It is this US $ balance that would be subject to a potential "inactivity fee"; in our case, these funds are regularly accessed each month to pay LL. This regular conversion incurs a flat 3.5% transaction fee. This is separate from the "process credit" fee. CDS does not withdraw funds out of SL into a Paypal account, so "process credit" does not affect us at this time. I would however not be surprised to see the L$ to US $ conversion fee of 3.5% also increase in the near future, to "help offset increased regulatory and compliance costs" of Tilia managing these US $ accounts going forward.
An entirely separate issue, not mentioned specifically in the LL blog post, but raised by a reading of the Tilia Terms of Service, does concern both L$ and US $ funds. Tilia refers to "Virtual Tokens", which I take to mean L$. Tilia states that Virtual Tokens have no (zero) "stored value" in themselves; only the Platform (Linden Lab) may offer an exchange of L$ to US $. This implies that any loss of L$ is not "real". There is language in the ToS that states that both Virtual Tokens (L$) and Stored Value (US $) account services are provided "as-is". This means "no warranty, no recourse" if things go wrong, whether a database loses data, the account holder cannot be properly verified to perform a "process credit", or Tilia absconds with the funds (ie. Bitcoin exchange thefts).
Another section that caught my eye in the ToS is "Assignment". Tilia does not allow this. I read this to mean that in CDS, the Treasurer may not "assign" the US $ (or L$?) account balance to another person. With a "normal" bank account, I may hold this as a "joint account" and the other party may withdraw funds as they wish; or a "payable on death" beneficiary may be designated, entitling the beneficiary to the funds. I do not know how or if this would impact procedures already in place in CDS.
What does this mean for CDS, today, from my personal perspective?
Just a few weeks ago, the RA considered a stylistic update (of "city" to "CDS") for the Financial Reserves Act. Sudane pointed out in a Forum post, http://forums.slcds.info/viewtopic.php?f=20&t=9023 that CDS funds are kept in two L$ accounts (avatars). While I was considering language to update the Act to more accurately reflect the Treasurer's "best practices", it quickly became clear that the Treasurer Act and Estate Owner Act would also be affected.
Given the entrance of Tilia and their stated ToS, we must now ask, "Is it still desirable to maintain all of CDS' accumulated reserves in L$ accounts?". A "safe" approach may be to withdraw L$ reserves out of SL and instead maintain these sums in a "real" bank account. However, doing so would incur significant costs, both in financial and procedural terms. For example, converting the accumulated L$ reserve to US $ would first incur a 3.5% conversion fee, then again another 5% "process credit" fee to withdraw the sum from SL. As a process matter, the Treasurer would perhaps set up a separate US $ bank account (ie. a "real" account at a "real" bank such as Chase or Citibank) to hold the funds, a significant process itself and not fee-free. Further, making the funds available again to SL, through the US $ purchase of L$ also incurs a small (US $1.49 per transaction) fee. Finally within CDS, many of our laws and processes would be affected.
We may choose to continue "business as usual". We should however be aware of the risks (ie. L$ have "no value" and Tilia's services are "without warranty") and have a plan in place if things do change. Unfortunately, long-tail events such as "data loss" or "exchange theft" are difficult to foresee.
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Their cognitive behavior therapy "would you please get up for the morning sport exercise, Mx. Milestone?" stopped working the other day 
I will start to work again coming week.
