COPY command cannot access file...

I have an application that will only ever run locally on a development box.
The application writes a text file to the hard drive, and then issues the
"COPY" sql command to import records in that text file. The application ran
fine on one box, but then when trying to run it on another, I keep getting
error messages, something such as...

COPY command, running in backend with effective uid 501, could not open
file...

501 is the postgres user.

I understand why this is happening. The database server, does not seem to be
able to access the file and from what I understand changing permissions of
the file will not help. What I need to know is how can I give the database
server permission to read such files? I have a number of scripts written
this way that import millions of records. I read somewhere I should use the
'psql \copy' command instead. But then the manual page for the psql command
reccomends the SQL copy command for large numbers of records, and I would
hate to have to rewrite so many scripts to change it. With that, how can I
grant the database server what it needs to read these files.

Thanks in advance.
Alan