On June 19, 1999, at 1400 hours Pacific daylight time, a Piper J3C-65, N26842, impacted terrain after takeoff from the Elko Muni-J.C. Harris Field, Elko, Nevada. The airplane, operated under 14 CFR Part 91, sustained substantial damage. The commercial pilot/owner, the sole occupant, was not injured. Visual meteorological conditions existed for the local area personal flight and no flight plan was filed.

The pilot stated that the airplane had received an annual inspection in June 1999. Prior to initial takeoff, the airplane was taxi tested for about 2 hours, and the engine started easily and ran smoothly at the lower rpm setting.

On the run-up before takeoff, the pilot performed the magneto check with no discrepancies noted. During the takeoff roll, the pilot noted that the engine did not produce full power. On the initial climb he noted a further loss of power and decay in airspeed. He stated that he thought there was something wrong with the engine because the rpm would not go above 1,600; however, he elected to continue the takeoff. After becoming airborne there was a further loss of airspeed. He attempted to turn back to the runway for landing, but as he was making the crosswind turn to the downwind leg, the left wing stalled and the aircraft "fell 50 feet to the ground."

In the pilot's written statement to the Safety Board, he indicated that he should have aborted the takeoff sooner.

An airworthiness inspector from the Federal Aviation Administration (FAA) inspected the airplane. The FAA inspector stated that this was the first flight after an annual inspection had been performed. The inspector further noted that the engine never fully developed power and the pilot elected to continue the takeoff resulting in a further loss of engine power and subsequent crash. During the engine inspection he observed the number 2 cylinder compression ratio was 14/80 with excessive exhaust and intake valve leaks, and the number 3 cylinder compression ratio was 20/80 with an excessive intake valve leak. No further discrepancies were noted.

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