On October 1, 1999, approximately 0645 mountain daylight time, a Gray Rotorway Executive homebuilt helicopter, N716JB, registered to and operated by the pilot, was destroyed when it collided with terrain during descent at Gallup, New Mexico. The solo student pilot was seriously injured. Visual meteorological conditions prevailed, and no flight plan had been filed for the instructional flight being conducted under Title 14 CFR Part 91. The flight originated at Gallup, New Mexico, approximately 0630. In his accident report, the pilot said he intended on remaining in the traffic pattern to practice touch and go landings. He had purposely planned the early morning flight because the "wind is usually calm and density altitude is lowest, giving the helicopter best performance capabilities." The flight was uneventful until the helicopter reached the point where the pilot would turn from downwind to base leg, and he noticed the "rotor rpm was low (95%)." He turned the helicopter towards the runway and "lowered collective [to] stabilize rotor rpm." At this point, "the engine failed." He "lowered collective [control] all the way down, [pushed] the cyclic [control] forward, and began autorotation." The helicopter descended toward houses, so he "extended [the descent path] by pulling collective." Rotor rpm fell to 80%. The pilot headed towards a small open field but as he descended to 100 feet agl (above ground level), he noticed powerlines ahead. He did a "second extension," and power dropped to 60%. Approximately 30 feet agl, he pulled the nose up and added full up collective to arrest the descent. The helicopter struck the ground tail first, then rolled over on its left side. In December 1999, the engine was functionally tested at the facilities of Rotorway in Chandler, Arizona. Despite impact damage to the crankshaft, the engine operated normally.