Be careful! Both answers above have problems because in the end they do the same thing. At this point, the shorter four step procedure is better.
I cannot comment on the changes between Sierra and previous versions, but both suggestions have an issue with the UUID that is assigned accounts.
There are three numbers which identify a user on Macs, the first are the uid and gid mentioned on the longer procedure above, The longer procedure essentially manually recovers the uid/gid to the previous values, the in the second procedure the system will reassign the uid/gid combination on all files in the home directory for you. This is great if the only thing you are worried about on the server is the users files.
The problem is the third user identifier, which is used by most of the Server services to identify the user. Both procedures above assign a new UUID to the account, meaning that all services will need to be reconfigured from scratch. For mail, you need to delete the old network users and add the new local ones, but you will then lose all mail stored on the server for the user. Therefore, before proceeding, you need to move all mail to an on my Mac store or export it somehow, then make the user changes and move the mail back again. The same holds true for all other services provided by that server.