i have found this species many times. previously i thought it was panaeolus foensici
first i found it growing near the base of shin/knee high clumps of old well (naturally) mulched grass. I thought this amount of thatch/mulch may be an important part of its habitat. but since then i have found it growing in park situations. In fact it grows in pound quantities on the campus of Augusta State University, in the “quadrangle” during spring and summer.