I've used very thin layers of completely DRIED grass for years with out it heating up. They're perfect for square foot gardening boxes or even lightly in containers. If you use your own clippings you'll know they're herbicide free. Dry them out on a tarp on nice days & cover up at night so no dew forms. When they're light brown and smell like hay you can use them without getting slimy in the garden. I often dry the clippings from our first mowings of the year because the lawn is very green & healthy then and store until the soil is warmer in later spring. If I wait until summer to mow the lawn isn't as lush and green, so the clippings aren't as nitrogen rich. Plus if I mulch too early on the soil stays too cool, so I wait. Sometimes, our grass has gone to seed, but isn't ripe, so no seedlings sprout. If you had brown grass heads you might get reseeding. I take out a few handfuls & put in a bucket to carry to the garden to spread about a tablespoon at a time with 2 fingers around, but not touching the stems of young plants. Be sure there are no lumps or clumps, just a LIGHT layer that overlaps. I add more about every few weeks as needed to keep the soil covered and moist. As the plants grow you'll know when you need more. I use my finger or a chopstick stuck in the soil to check the moisture below. By mid-summer when we've had no rain for a month I've built up thick layers that no weeds can penetrate and the soil stays nice underneath. Larger plants get more, but make sure THIN layers of dry grass at a time. Probably still no more than a half inch at a time. Don't ever add green clippings on top unless you're very careful to sprinkle little bits like teaspoons of them VERY THINLY during warm dry weather to dry in place. The dry grass doesn't attract slugs more than other mulch, but I do use iron phosphate baits & patrol for slugs with a stick or shovel and soapy bucket handy. For tomatoes and large zucchini plants I prefer to use an older bale of straw that clumps together and I can pull off sheets of straw to place side by side. Grass clippings fill in the gaps. New straw is a bit slippery for walking upon, but also works if that's what you have. I haven't yet mulched our boxes because we've had 2 weeks of dry weather until yesterday. Today it's raining non-stop soaking everything nicely, so I only went out for slug duty this morning and dodged puddles in the driveway. The forecast is for rain until Friday, so when there is a break I'm going to jump on it to get the mulch applied. I have 2 trash cans full still from last year, so have plenty. Also be sure to water gently so you don't move your mulch layer. Mulch goes over the soaker hoses. Spread after watering or a rain to keep moisture in. Once dried out it's hard to rewet the soil when you have that mulch layer. We have dry summers, so mulch really reduces the watering needs and keeps our lettuces tasty.

We have used pine straw mulch before and have been pleased with the results. We used it to mulch a steep area (the slope is steeper than 45 degrees). Wood mulch just rolls downhill, especially if it rains hard. The long strands of the pine straw weave together a bit and hold in place much better. So I don't think that it would blows around very much either. The color of the pine straw mulch isn't very strong, so I haven't seen that it fades noticeably. There are spray-on mulch colorants, but I haven't tried those. Pine straw isn't readily available here, so I had to find the closest horticultural place that had it (one state over) and have two pallet-loads sent over by freight! I feel your troubles with the HOA. I could never tolerate living under such conditions. So we live out in a small town on a road with corn fields and sheep and commute. Give the pine straw a try. It's quite a bit different from shredded hardwood bark mulch, but several of those differences are advantages. You'll not know whether you like the differences between them until you use it.

I use the plastic edging around a garden that's on a similar slope in my yard to keep sheet water from flowing through and washing out the mulch. Given your neighbors' yards appear to be draining through the area and the amount of rain you get in NC, I'm betting you have a lot of water rushing through there at times. BUT if you completely blocked off the whole area with plastic edging, it would flow right over and do absolutely no good (not to mention ticking off the neighbors in the process). Therefore, you could divide the area into three or four beds, leaving at least a couple feet in between to allow water to rush through the grassed or rock channels. You can then mulch the beds without too much water running the gardens and washing out the mulch. I don't know how much water comes through that area, so I'll leave a necessary size of the beds and channels to you. This may not be the most aesthetically pleasing way to do this but it may help keep the mulch in place. If you do go through with this, be sure to watch the edging you buy. At least one big box seller with orange aprons, in addition to its cheap stuff, offers a "professional grade" in a larger bundle that's of much much better quality (taller, thicker, heavier, more rubbery) for not much, if anything, more. In addition to lasting longer, it's a lot easier to install IMO.

Pine straw IS mulch.........mulch is only a top covering of the soil, not a specific material. Generally, the best mulch to use is whatever is readily available for your area and inexpensive. Concerns about a bark mulch and termites tend to be overstated. Wood or bark mulch doesn't attract termites.......but it does make a desirable habitat for them. But the same thing can be said about any kind of mulch......even rocks and inorganic rubber mulch. They just prefer the cool, dark and moist conditions that exist under the mulch. If termites are a concern, keep ANY mulch well away from the side of the house or other structure. A buffer zone of around 12" between the edge of the mulch and the side of the house is suggested. And make sure no wood siding is touching the soil - 6" of foundation should be exposed. And if termites are a concern in your area, keeping an eye on both the inside and outside of the foundation for any tell-tale signs is always prudent.