On July 25, 2007, at 1947 mountain daylight time, a Bell 214ST helicopter, N724HT, sustained substantial damage when it impacted terrain following a loss of control while conducting long-line operations in a remote area 22 miles northeast of McCall, Idaho. The airline transport pilot (ATP) sustained serious injuries and the passenger/crew chief, sustained minor injuries. The helicopter was registered to US Leaseco, Inc of Baltimore, Maryland, and under the operational control of the United States Forest Service (USFS). Visual meteorological conditions prevailed and a flight plan was filed for the local public use flight. The purpose of the flight was to conduct external load operations in support of the Loon fire. In a written statement provided by USFS personnel, the pilot was making an approach to a lake in order to fill a 900-gallon Bambi bucket attached to a 150-foot long-line. As the approach continued, and just prior to the bucket entering the water, the pilot reported that "he was encountering the onset of settling with power." The pilot lowered the collective and initiated a 180-degree turn. During the turn, the bucket entered the water and the 150-foot long-line "pulled the helicopter" on "the right side of the aircraft" while the pilot was maneuvering about 20-40 feet above the water. Subsequently, the helicopter collided with terrain in a marshy area adjacent to the shoreline resulting in substantial damage. The operator reported the estimated density altitude at the time of the accident was 10,221 feet. Examination of the helicopter revealed no mechanical anomalies with the engine or airframe.