On August 14, 1995, at 0520 central daylight time, a Piper PA-31, N9123Y, operated by G&W Aviation, Inc., sustained substantial damage when it departed the runway and impacted terrain during an aborted takeoff in Iron Mountain, Michigan. The commercial pilot and six passengers reported no injuries. The personal, 14 CFR Part 91 flight was planned to Chicago, Illinois. Visual meteorological conditions prevailed and an IFR flight plan was filed. In his written statement, the pilot reported that he conducted a normal takeoff and the number one engine lost power when the airplane was at approximately 25 feet above the runway. He "lowered the nose, pulled the power, and landed straight ahead." The airplane landed left of the runway and slid through a drainage ditch. The nose and left main landing gear collapsed. The airplane sustained substantial damage to the left wing. The wreckage was examined by a Federal Aviation Administration (FAA) inspector who reported no evidence of preimpact airframe or engine malfunction. Both propellers exhibited rotational damage. When tested, the fuel system provided fuel to both engines at the firewall. The number one engine was examined and tested at Textron Lycoming, in Williamsport, Pennsylvania, on October 19, 1995. The intake manifold contained an abraded penetration approximately 1.5 inches high by 1/8 inch wide in the rear left corner, underneath the rear baffling. A significant amount of particulate ferrous metal was recovered from the oil filter. No other mechanical malfunctions were noted. A test club was installed and the engine was tested in a production test cell in the "as received condition", except for the replacement of the engine oil and oil filter. The engine operated normally during the test run and produced 85 percent of the rated power. The pilot operating handbook (POH) for the PA-31-310 specifies for a normal takeoff "At 90 MPH, CAS, rotate the aircraft and allow it to fly off." The limitations section of the POH specifies a minimum control speed of 85 miles per hour.