On June 29, 2000, approximately 0945 Pacific daylight time, a Bellanca 8KCAB (Decathlon), N31286, operated by The Flight Shop, Incorporated as a 14CFR91 instructional flight, sustained substantial damage during the landing roll at Bend Municipal Airport, Bend, Oregon. Visual meteorological conditions prevailed and no flight plan was filed for the local instructional flight. The certified flight instructor (CFI) and private pilot were uninjured. There was no fire and no report of ELT activation. The CFI reported that he and the second pilot were practicing three point landings on runway 16. He stated that on the second landing, the aircraft touched down, tail wheel first, and the aircraft began to drift to the left of runway centerline. Both pilots attempted to correct the situation by applying full right rudder, but the aircraft continued to track to the left. The aircraft traveled off the runway and collided with a visual approach slope indicator (VASI) lighting system. The aircraft's empennage and wing lift strut sustained substantial damage. Post-accident inspection of the aircraft by an FAA Inspector from the Portland, Oregon, Flight Standards District Office revealed that the aircraft's pneumatic tail wheel tire ruptured in a worn area of the tire's running surface. The CFI stated that significant wear to the tailwheel tire was noted during the preflight inspection, however, he believed the tire was still in an airworthy condition.