Permissions don't cascade from subgroup to private repo

Summary

Permissions given to a user in a subgroup do not cascade down to a private repository. It's expected that all permissions cascade down from the group and subgroup structure.

Steps to reproduce

Do the following for setup:

Structure: Internal Group -> Internal Subgroup -> Private Repo Permissions: Reporter -> Developer -> Reporter (rather than Developer)

What is the current bug behavior?

The user is given reporter permissions that look to only be inherited by the initial group rather than the subgroup.

What is the expected correct behavior?

The user is given their highest permission and its inherited by its closest group membership.