Before completing "Step 2: Alyce Authorization" in the Salesforce installation process, update your Alyce endpoint to reflect a sandbox installation. This should be done for all users involved in sandbox testing.
Navigate to Setup
Search for “Custom Settings“
Click the “Manage“ Action next to the “Alyce Endpoints“ Label.
Click "Edit" next to the Setup Owner.
Update the “AlyceBase“ field to a value of “https://sandbox.alyce.com“.