The local is changing. Place a Message Popup step after the vi step. Edit the message to be like this:
"Array elements:" + chr(0x0A) +
str(Locals.ModelConfigTest[0]) + chr(0x0A) +
str(Locals.ModelConfigTest[1]) + chr(0x0A) +
str(Locals.ModelConfigTest[2]) + chr(0x0A) +
str(Locals.ModelConfigTest[3]) + chr(0x0A) +
str(Locals.ModelConfigTest[4]) + chr(0x0A) +
Execute the sequence. The popup will display the data that is defined in the vi, proving that the vi data did get passed to TestStand.
Another way to see the new values is to put a breakpoint at the new message popup step. Run the sequence. When the breakpoint is reached, a popup will appear. Select the Context tab. Open the Locals tree (click on the + sign), then click on ModelConfigTest. On the right side of the screen you will see all the array elements and their modified values. Note that you will not see the changes in the original Locals tab of the sequence editor. This is for the default value of the locals, and will not be changed programatically.