** EDIT ** Mike - Any chance you increased the model db size instead of decreasing it? Knowing that Sage 100 hard-codes the db file size at 500MB for new and copy companies, this error makes sense if model db data file size is more than 500MB. If you do a sp_helpdb model AND sp_helpdb MAS_DSD, you can compare their current physical sizes.

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SQL 2016 right? I wonder if adjusting the model db size requires restarting the SQL service. Also verify that in SSMS the Mas_User sql login still has the server role dbcreator assigned to it.

Alnoor, thanks.  MAS_User has the dbcreator server role assigned to it.  Also the server log is reporting that login failed for MAS_User, although the Premium Settings Utility does not report any error when testing the connection.

Alnoor.  This was defintely the solution, reducing the size below the threshold, and it was still necessary to shrink the log to change it's size even after the changes are made and the services are stopped.!