Our Past-President is one of the board members and chair of the nominating committee. Overall, it makes sense and works well for us.
But do note - and we've had the most amicable transfers of power possible - it is a little hard sometimes for the old pres to find the right level of participation as the new pres tries to carve out his/her path as the leader.
This is true even the best situation. In a bad situation - where the former pres is NOT cooperative or perhaps not fully ready to relinquish control - it can be harder. I don't think you should avoid the idea because of this, but just be aware of the human dynamics.
At our school we have the outging president as our by-laws chair. This way she's there to help the new president with anything she may question. It's been this way for many, many years and has always worked out well.
A idea has come up about this years president being an advisor for next years board. The principal and I think this is a great idea...does anyone have this stated in their bylaws and if so how did you state it? Thanks!!