This is the "correct" thing to do, in my opinion

Thanks !

they use it and they grow.

Exactly, as my old boss told me when I asked him why we were spending so much and raising capital every year instead of having a longer runway "we don't want to leave any growth on the table, so we spend as much as possible to gain as much growth as possible"

funding increases and you have a proposal to do development work - use it to get more development work done

The only caveat to this is some proposals don't adapt well to increased funding like hivesql who's purely infra costs (which don't adapt well to a 2x increase) and then there are people who may just not want to produce more work which is totally understandable imo.

, and returning it to sit in the fund unused doesn't seem like the best way to do that to me.

To be fair it's not exactly "returning it" it's sending it to hbdstabilizer which makes a direct profit for the dhf. Which as some stakeholders argue, brings more value than any proposal. Because it's much more straightforward (double the value that you get from the dhf)