Answer: The bugs could be mealybugs if they look like cottony tufts, but they might be something else. Adelgids have a similar appearance and they generally attack needled evergreens. You didn't specify the affected plant so I can only guess at the bug's identity. I'd suggest taking a sample of the affect plant parts to your local nursery for positive identification and control measures.
Either spring or fall are good times to renovate a lawn. Any warm season grass mixture will grow well in your region. Most nurseries have customized mixes, blended especially for your growing area.
Best wishes with your garden!
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