vscode-csharp: Debugging on Windows fails with "Could not load host policy library"

Repro Steps:

• Windows 10
• Install VS Code
• Install latest .NET Core SDK from https://dotnetcli.blob.core.windows.net/dotnet/beta/Installers/Latest/dotnet-win-x64.latest.exe
• Install latest C# extension from https://github.com/OmniSharp/omnisharp-vscode/releases/download/v0.3.9/csharp-0.3.9.vsix

At the command line:

• dotnet new to create new project
• code . to open newly-created project in VS Code

In VS Code:

• Click “Yes” on prompt to add required build and debug assets.
• Open project.json and add "debugType": "portable" to "compilationOptions" section
• Open Program.cs and click the margin at line 9 to add a breakpoint on Console.WriteLine("Hello World!");

Expected Result: Project compiles, runs, and breakpoint is hit.

Actual Result: Project compiles but breakpoint is not hit. Instead, the following text appears in the Debug Console:

Could not load host policy library [c:\Projects] The program ‘c:\Projects\helloworld/bin/Debug/netstandard1.5/helloworld.dll’ has exited with code 131 (0x00000083).