My members could create categories before the upgrade.
Currently, if I go to the following:
Site > Admim > Members & Groups > Member Groups > Edit ‘Members’ group > Weblog Posting Privileges
Yes is selected for “Can edit and add new categories”
However, when the user is logged in and is publishing an entry and selects Categories, and goes to add a category by clicking one of the category trees below the filed housing all the categories, he/she gets the message:
You are not authorized to access this page