Powershell Custom script Error!

I've been grappling with this issue for a few days now, and can't seem to figure out what is causing the permission issues that Manage Engine is having when attempting to run my powershell custom script.

I've used the same variable calls as well as powershell custom scripts successfully on new user creation, however when i'm attempting to use custom scripts at the end of the modify users templates i'm getting permission issues.

For example i'm attempting to create a new folder upon the execution of my modify user script, but i'm getting the following error...

Custom script result: New-Item : Access to the path '%username%' is denied. (note that %username% actually shows the correct user name for my test users...)

Any help will be greatly appreciated!