We went through this changeover from developer (who had run the HOA since 1999)... to our own Home Owner operated HOA, back in 2007. It's a senior (an older person) senior community, of 65 homes, so there were only a few people who would/could take the lead in the changeover.
A very interesting project. I took over the basic rewrite of the Agreement and the Rules and Regulations, a 19 page document. Prior to this, the originals were heavily weighted towards the interests of the owner/developer, so there were many changes that had to be made to make it more friendly. We had originally hired a lawyer to do this, but he basically returned the original documents to us... which included some superfluous paragraphs as well as leaving out many other important points such as the establishment of a reserve.
Since our association has the responsibility for lawn care, shrubbery, and snow removal, as well as insurance and a relatively small common area... I don't see how we could operate without some legal entity.
The filing with the state, was a little bit tortuous, but we blundered our way through it in good shape, and our residents are quite happy with the result. Virtually no complaints from the residents.
On the PLUS side... we hired a manager who has been excellent... not only by staying on top of the needs, but saving enough money to establish a strong reserve, for things like lawn failure or tree removal which we didn't have before. In addition our semi annual meetings are now dinners and picnics, which are well attended, and one big plus... for all of the houses, the wood door and garage door frames were covered with aluminum at no cost to the residents ('cept ftrom the dues, which weren't obligated to pay for these improvements).
BTW... our lawns a maintained like a golf course, and the pride of the community and the town.
Old people are not inclined to be patient when things go wrong, but for the past three years, the only complaints that were heard from the residents, were about unauthorized solicitors coming to the door. Even this has since been corrected.
In our case, I don't know how we could live here without a Homeowners Association. A good manager is the key, IMHO.