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Windows Service Access Denied to Path

I am trying to test an update to a Windows Service and I need for it to read a file on my local drive e.g. C:\testfolder\Schema

I have done everything I can think of to grant rights to this folder for everyone and I continue to get this error.  Error Message -- Access to the path C:\testfolder\Schema.  The service is running as LocalSystem.  My login has Administrator rights.  

Does anyone know what could be wrong.

thanks in advance.
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Adam Ray
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Avatar of kaufmed
Is that a file or a directory? Files in Windows normally have extensions.
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ASKER

I have gone through the "advanced" settings and have taken ownership of the top level folder.  Still getting an access denied.