Topdressing your lawn with compost is beneficial for many reasons:
1. Most importantly, it adds nutrients and living microbes to the soil environment
2. It encourages more water applied through rain or sprinkler systems to stay in the turf zone before it evaporates
3. It encourages a healthier "drought tolerant" root structure
We did a series of posts on the topic of composting your lawn this summer and I have attached the links if you want more information.
http://preferredlandscape.blogspot.com/2011/07/compostingas-good-as-it-gets-for-your.html
http://preferredlandscape.blogspot.com/2011/07/when-to-compost-your-lawn-what-blend-of.html
http://preferredlandscape.blogspot.com/2011/07/top-dressing-your-lawn-do-it-yourself.html
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