Unable to execute your Windows password change

I have a test server (version 8) with LN 8 client. SSO is turned on and the network password is different. When I log into Notes, it prompts me to synchronize the passwords. I respond yes and proceed to synchronize the passwords. The last password dialog box ask to enter the current Windows password; after the network password is entered, Notes issues a message "unable to execute your Windows password change: Access Denied.

The user has local administration rights. Has anyone experienced this problem and what is the fix.

Thanks!