Unit Test Adapter threw exception: URI formats are not supported

In Visual Studio 2010 when I create the default test project with the following bare bones code:

<TestClass()>
Public Class UnitTest1

    <TestMethod()>
    Public Sub TestMethod1()

        Assert.AreEqual(1, 1)

    End Sub

End Class

I get the following error:

Unit Test Adapter threw exception:
URI formats are not supported..
-- Exception doesn't have a stack trace --

1. Open up Local.testsettings in your Solution Explorer > Solution Items
   

2. Go to Deployment and make sure Enabled Deployment is checked ^{(it's unchecked by default)}