Fiscal federalism in Kenya has been crippled by the sprouting culture of elite capture. Persons under whose jurisdiction the developed funds fall have stamped their control over the funds through appointing cronies to committees that manage the funds. The funds have in consequence been used to reward loyalty and punish the people on the opposing side. The beneficiaries have become spectators in the development process since their needs and priorities are decided upon by elite appointed committees. To this effect, the principles and fundamentals of Rights Based Approach to development are overlooked as participation is crippled. In case of participation by beneficiaries, it is at the basic level of information sharing about the prospected projects by the committees without necessarily taking into account the most pressing needs of a community.