On September 18, 1994, at 1800 central daylight time (cdt), a Cessna 170, N4271V, registered to Donald J. Dennehey Jr. of Lakeville, Minnesota, and piloted by a private pilot, was substantially damaged during a collision with powerlines and terrain following a pilot reported power loss and forced landing. Visual meteorological conditions prevailed at the time of the accident. The 14 CFR Part 91 flight was not operating on a flight plan. The pilot and two passengers reported minor injuries, a third passenger reported no injuries. The flight departed Lakeville, Minnesota, at 1740 cdt. During an interview with a Federal Aviation Administration Principal Maintenance Inspector (PMI), the pilot said the engine stopped running shortly after takeoff. He said he attempted to land the airplane on a four-lane highway, but collided with powerlines that crossed the highway. The pilot was asked where the airplane is normally stored. He said it had been stored outside. The pilot told the PMI the airplane had not been flown since September 8, 1994. He said the airplane's fuel tanks were topped off about ten days before that flight. The airplane was not refueled after the September 8 flight. According to the PMI, the pilot said he had flown the airplane for one hour before refueling it on September 18, 1994. The PMI said the pilot told him that he had drained about one cup of water from each fuel tank before the accident flight's departure. The on-scene investigation revealed water in the carburetor float bowl according to the PMI. The PMI said the fuel was removed from the airplane's fuel tanks before he arrived on-scene because the fire department believed a fire hazard existed. The PMI said he examined the engine's carburetor and found what appeared to be traces of water in the accelerator pump well and float chamber. An examination of the fuel tank caps revealed a tight fit and an undamaged gasket on each cap. N4271V's engine sustained damage during the crash sequence that prevented it from being run. Evidence of precollision mechanical failure was not found by the PMI. The PMI stated he had checked the fuel source for N4271V. He said the airport operator's tanks were inspected, and passed, by the State of Minnesota about 30 days before the accident. Other airplanes were refueled before and after the accident according to the PMI. He said these airplanes reported no problems with their fuel supply.