On July 30, 1996, about 0830 hours mountain standard time, a Waco UPF7, N29974, ran off the runway, struck an obstruction and ground looped while landing at Payson Airport, Payson, Arizona. The aircraft sustained substantial damage; however, neither the commercial pilot nor his passenger/mechanic was injured. The aircraft was being operated as a personal flight when the accident occurred. The flight originated in Payson about 0815 on the day of the accident. Visual meteorological conditions prevailed at the time and no flight plan had been filed. The pilot reported to an FAA inspector that he and his mechanic were performing a maintenance test flight after an engine overhaul. While on final approach to runway 24, the pilot did not maintain adequate peripheral vision, lost directional control, and ran off the left side of the runway. He attempted a go-around but the aircraft struck an open trench causing it to abruptly yaw about 120 degrees. The left main gear then collapsed which allowed the left wing and propeller to strike the ground. After the accident the aircraft was moved to a hangar on the Payson airport. A postaccident inspection conducted by an airworthiness inspector found damage to the left wing spars.