If they used to be a good poster and a valuable moderator, I would remove them as moderator. At the same time, send an e-mail saying: "I have temporarily removed you as moderator because you haven't visited in X months. Therefore, I don't want it to be confusing for members who try to contact you as part of the forum staff, etc. Should you ever choose to resume your activities on our forum, I will happily reinstate you!"

Besides starting my own little forum I am a Mod on a Big Board with over 40,000 members.

I am not sure about your forum but in my expreiance Modding can burn you out faster than just being a member or an Admin. I usually take a few weeks off every 3 months or so. Otherwise my burnout would show on the forums which is never a good thing.

If this person was a good Mod than I would say keep them on but get another as well.

The Big Board has about 8 active Mods and the others pick up the slack when one goes on hiatus.