Answer: Grass clippings are a source of nitrogen. As the clippings decompose, nitrogen is released. An additional benefit is that the organic matter that's left can be worked into the soil at the end of the season. Grass tends to mat down when it's fresh, which could keep water from penetrating down to the soil in your veggie bed. Monitor your watering carefully to make sure that the roots of your plants are actually getting enough moisture!
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