User participation in the management of irrigation systems has been touted as a means to establish incentives for proper operation and management, decrease distortionary governmental subsidies, and increase water-use efficiency. The Government of Honduras has been in a process of rehabilitating and transferring management responsibility of the Flores irrigation districts to farmers. This paper presents a review of the transfer process, an analysis of farmers? capacity to accept financial responsibility for the systems, and an analysis of farmers? preferences towards the privatization process. The research intends to support the ongoing transfer process by identifying constraints and proposing improved strategies.