When the sprinkler guys come out to repair mine, they just use your everyday ordinary spade. And they usually have a 99 cent trowel in the bag too.

I prefer to use a post hole digger to form the outside circle of the cut to make a uniform cut and then use a smaller spade to remove the dirt. I wouldn't go out and buy a posthole digger just for this job, but since I own one I find it makes getting the sod back in when I'm done easier. I had to do quite a few changes when I added and extension to the line for more heads and had to replace them all with lower capacity heads in order to keep the pressure up.