Can't upload featured image

Newly manually installed WordPress v3.9.1.

Using Espresso theme, with Espresso Add Ons plugin.

Espresso Add Ons plugin allows you to create feature blocks to display under the page content. Feature blocks are custom post types. When I try to add a featured image to a feature block, I receive the error:

Unable to create directory uploads/2014/07. Is its parent directory writable by the server?

The directory, /wp-content/uploads/2014/07 exists already, and has 755 permissions.

I receive the same error when I try to upload an image to the Media Library, so the issue is not specific to feature blocks.

Why does WordPress want to create the directory when it already exists?

Why doesn’t WordPress upload to the current 07 directory?

Thanks.