After resolving the issue with the SQL Timeout error, the attempt to upgrade Management Reporter produced an error message at the validation stage:
Database configuration: Unable to connect to the specified database server with the Management Reporter service account. Make sure the database server is correct and that the service account has a SQL Server Login.
After clicking Close I launched Management Studio and loaded the properties for the user account used for the Management Reporter services:
After clicking on User Mapping I was able to see that the Management Reporter database was not selected. I marked the checkbox next to it and clicked OK.
I was able to click the Proceed button and continue the deployment. With the extended timeout from the last post, I left the upgrade running in the back ground.
Unfortunately, the story was far from over.