GitHub Actions - Postgresql - Diesel-rs: Invalid connection url for multiconnection

I am trying to setup a GitHub Action to test my Rust application, but the diesel migrations keep failing with the error message:

Could not connect to database via postgresql://app_user@127.0.0.1:5432/app_testdb: Invalid connection url for multiconnection

Full Error Message Text

Run diesel migration run
  diesel migration run
  shell: /usr/bin/bash -e {0}
  env:
    DATABASE_URL: postgresql://app_user@127.0.0.1:5432/app_testdb
    CARGO_INCREMENTAL: 0
    CARGO_TERM_COLOR: always
Could not connect to database via `postgresql://app_user@127.0.0.1:5432/app_testdb`: Invalid connection url for multiconnection
Error: Process completed with exit code 1.

At this point I have tried adding a LOT of troubleshooting steps, including multiple steps to confirm that that the Postgresql.service is up and running. Currently I have also added a step to verify connectivity using pg_isready, which is successful.

What else am I missing here?

Database URL being used:
postgresql://test_user@127.0.0.1:5432/app_testdb

Complete GitHub Action YAML:

name: App-Testing
on:
  push:
    branches:
      - "**/*"
  pull_request:

concurrency:
  group: "${{ github.ref }}"
  cancel-in-progress: true

jobs:
 
  Test-App-Build:
    runs-on: ubuntu-latest

    steps:
      - name: Start PostgreSQL
        run: |
          sudo systemctl enable postgresql.service
          sudo systemctl start postgresql.service
          
      # Create the app database
      - name: Create database
        run: |
          cd ~postgres/
          sudo -u postgres psql -c 'CREATE DATABASE app_testdb;'

      # Create the app database user
      - name: Create database user
        run: | 
          cd ~postgres/
          sudo sudo netstat -plunt |grep postgres
          sudo -u postgres psql -c "CREATE USER app_user WITH PASSWORD 'changeme';"
          sudo -u postgres psql -c "grant all privileges on database app_testdb to app_user;"

      # Set up environment variables for database URLs
      - name: Set up environment variables
        run: echo "DATABASE_URL=postgresql://app_user@127.0.0.1:5432/app_testdb" > "$GITHUB_ENV"

      - name: checkout
        uses: actions/checkout@v3.5.3
      - uses: dtolnay/rust-toolchain@stable
        with:
          components: rustfmt, clippy

      # Install diesel CLI if not already installed
      - name: Check diesel installation
        run: if which diesel; then echo "diesel already installed"; else cargo install diesel_cli --no-default-features --features=postgres; fi

      # Run database migrations
      - run: pushd app-models
      
      # Test the database connection as app_user
      - name: Test app_user database connection
        run: pg_isready

      - run: diesel migration run
      - run: popd

      - run: echo "SCRIPT"
      - run: cargo build --all --verbose
      - run: cargo test --all --verbose

P.S I am aware that I -could- use a Docker Container, however the GitHub-Runner ubuntu-latest already comes with PostgreSQL installed, so I see no reason to add complexity by trying to use "external" database service.

Diesel uses itself github actions for CI runs. So it's a good idea to have a look at their setup:

      - name: Install postgres (Linux)
        if: runner.os == 'Linux' && matrix.backend == 'postgres'
        run: |
          sudo apt-get update
          sudo apt-get install -y libpq-dev postgresql
          echo "host    all             all             127.0.0.1/32            md5" > sudo tee -a /etc/postgresql/10/main/pg_hba.conf
          sudo service postgresql restart && sleep 3
          sudo -u postgres psql -c "ALTER USER postgres PASSWORD 'postgres';"
          sudo service postgresql restart && sleep 3
          echo "PG_DATABASE_URL=postgres://postgres:postgres@localhost/" >> $GITHUB_ENV
          echo "PG_EXAMPLE_DATABASE_URL=postgres://postgres:postgres@localhost/diesel_example" >> $GITHUB_ENV