The solution to this is so obvious that I am embarrassed that it took me two days to figure it out! When the Rails portion of the site is active then Passenger needs to be active, but when the phpMyAdmin is accessed then Passenger needs to be disabled. The code snippet above attempts to disable passenger when phpMyAdmin is in the path, but the disabling should really occur in phpMyAdmin’s configuration file and the re-enabling should be in my Rails testapp configuration file as shown below:

/etc/apache2/sites-available/testapp.conf:

<VirtualHost *:80>
        ServerAdmin webmaster@localhost
        DocumentRoot /home/dev/testapp/public
        RailsEnv development
        ErrorLog ${APACHE_LOG_DIR}/error.log
        CustomLog ${APACHE_LOG_DIR}/access.log combined
        <Directory "/home/dev/testapp/public">
            PassengerEnabled on
            Options FollowSymLinks
            AllowOverride none
            Require all granted
        </Directory>
</VirtualHost>

/etc/apache2/conf-available/phpmyadmin.conf

Alias /phpmyadmin /usr/share/phpmyadmin
<Directory /usr/share/phpmyadmin>
        Options FollowSymLinks
        DirectoryIndex index.php
        PassengerEnabled off
        <IfModule mod_php5.c>
                AddType application/x-httpd-php .php
                php_flag magic_quotes_gpc Off
                php_flag track_vars On
                php_flag register_globals Off
                php_admin_flag allow_url_fopen Off
                php_value include_path .
                php_admin_value upload_tmp_dir /var/lib/phpmyadmin/tmp
                php_admin_value open_basedir /usr/share/phpmyadmin/:/etc/phpmyadmin/:/var/lib/phpmyadmin/:/usr/share/php/php-gettext/:/usr/share/javascript/
        </IfModule>
</Directory>