Since Favorites worked properly in other users accounts I decided the problem was being caused by file corruption and deleted the user where Favorites didn't work. Before I did this I tried to use a utility to bring configuration settings and data to a new user account. The utility did not work.
I now have one user setup in the VM. I ran PCTools Registry Mechanic. It reported 28 errors. I also ran a free download aand it reported 328 errors. I haven't made any changes to the Regisry. I'm still chewing on it.