0n September 26, 1993, at 1120 central daylight time(CDT), a Cessna 150H, N22313, registered to AD Airlines, Incorporated, and piloted by a commercially certificated pilot was substantially damaged during a collision with terrain following a banner pickup at the Gary Municipal Airport, Gary, Indiana. Visual meteorological conditions prevailed at the time of the accident. The pilot was not injured. The 14 CFR Part 91 flight was not operating on a flight plan. The flight originated from Gary, Indiana, at 1120 CDT. The pilot's written statement on NTSB Form 6120.1/2 showed that N22313's pre-takeoff run up, takeoff, and climb were normal. According to the pilot, "... I picked up the banner and started a normal climb. The full throttle climb 45 MPH climb rate lessened through 1000' msl and I looked backed to see if the banner was caught like a parachute but it was normal." The pilot stated he circled toward the departure airport because the airplane was approaching power lines he did not believe the airplane would clear. The pilot noted the airplane was descending more rapidly during the turn. He stated he made several attempts to release the banner and noted, during these attempts, that the airplane had a 400-foot rate of descent. The pilot stated he retracted the ten degrees of flaps that were extended for the banner pickup with the intention of extending the airplane's glide distance. As the airplane approached the ground, the pilot stated he "...flared and milked the ground effect... it stalled into irregular terrain main gear first, I reduced the throttle position to idle and unlocked the door." Statements on the pilot's NTSB Form 6120.1/2 were confirmed during a telephone interview. The pilot was asked what speed was used to pickup the banner. He stated he used 85 MPH and a climb out of 45 MPH. He said the airplane sank faster after retracting the flaps. When asked if he adjusted the airplane's angle of attack during, or after, the flap retraction, he stated he pitched the airplane down because it was flying at 45 MPH. According to the pilot, he pulled the banner release control after the turn toward the airport was initiated. He stated he was not certain when the banner separated from the airplane. The pilot stated the airplane's engine ran smooth during the flight. According to the Federal Aviation Administration (FAA) Principal Maintenance Inspector (PMI), the pilot was attempting to pull a 20' X 50' banner. The PMI said the owner of the banner towing company and airplane stated the climb out speed should be 60 knots when pulling the banner. The PMI said there were two airspeed indicators (ASI) in the airplane. Both had red marks painted at the 60 knot position. N22313's engine was static run to the red line on the tachometer (2,700 RPM). Both magnetos performed within the airplane's pilot operating handbook limitations. The PMI stated he did not observe fuel contamination in fuel samples taken from the fuel tanks and gascolator. Interviews of the accident pilot, a second company pilot, and the company owner were conducted by the FAA on-site representatives. The second pilot stated he had attempted to pull the same banner with N22313 approximately six weeks before the accident date. He stated the airplane was unable to climb after banner pickup which required him to drop the banner. He stated it was his belief N22313 was not developing full power on the day he attempted to pull the banner. The pilot stated he attempted to climb the airplane at 55 to 60 knots. He said a different pilot pulled the banner with the same airplane the day before his attempt and did not experience any problems. During the PMI interview with the company owner it was revealed that company pilots are to climb the airplanes pulling banners at 60 knots with 10 degrees of flaps extended. N22313 was equipped with a Lycoming 150 HP reciprocating engine via an FAA STC SA4795SW. The propeller on N22313's engine, Sensenich 74 DM6-0-58 is not approved for the engine/airframe combination.