On March 27, 1997, at 1515 hours mountain standard time, an Enstrom F-28C, N294SB, collided with the terrain after experiencing a loss of power on takeoff near Sacaton, Arizona. The aircraft sustained substantial damage; however, neither the instructor nor his student was injured. The aircraft was being operated as an instructional flight by Sunbird Aviation when the accident occurred. The flight originated at 1420 in Chandler, Arizona. Visual meteorological conditions prevailed at the time and no flight plan was filed. The instructor stated that he was demonstrating a confined area takeoff to his student. As the aircraft passed through effective translational lift (ETL) and reached about 20 to 25 feet agl, he noticed a reduction in engine noise. When he checked his gauges he noticed that both the engine and rotor rpm needles were still joined at a position just below the bottom of the green arc. He lowered his collective and rolled the throttle full on, with no corresponding increase in engine rpm. At this point, he initiated a straight-in autorotation, cushioning the touchdown with remaining collective and sliding about 5 to 6 feet. During the ground slide, the left skid contacted a rock and the tail boom yawed to the right. The tail boom then struck a Palo Verde tree and separated from the aircraft. A Safety Board investigator estimated that density altitude was approximately 3,000 feet at the time of the accident. After the aircraft was recovered, the main rotor drive belt was disconnected and the engine was started and run. A run-up check was also performed on the right and left magnetos with less than a 100 rpm drop on each. The engine ran smoothly throughout the normal operating range. The engine air cleaner was removed and examined. The element exhibited trapped dirt and grass.