Liquibase execute-sql Unexpected error running Liquibase: Unterminated dollar quote started at position

Question

We have a changeset to create a function in Postgres. We used update-sql to generate a .sql file.
Then tried to use execute-sql to run that sql file and we get the error message "Unexpected error running Liquibase: Unterminated dollar quote started at position..." We have splitStatements:false set.

Running liquibase update works. The generated sql works fine in pgAdmin.

Is this normal behavior or an error?

Postgres 16.3, Liquibase latest version 4.31.0, Windows op sys

Here is the changeset file:

--liquibase formatted sql

--changeset homer:1 labels:WI-12345 runOnChange:true splitStatements:false stripComments:false
--comment: Create function

CREATE OR REPLACE FUNCTION test_func1()
RETURNS TABLE(user_id INTEGER, firstname TEXT, lastname TEXT) 
AS 
$$
BEGIN
    RETURN QUERY 
    SELECT u.user_id, u.firstname, u.lastname
    FROM users u;    
END;
$$
LANGUAGE plpgsql;

Liquibase commands:
liquibase update-sql --output-file ./release/test1.sql
liquibase execute-sql --sql-file=./release/test1.sql

Exact error message:
ERROR: Exception Details
ERROR: Exception Primary Class: PSQLException
ERROR: Exception Primary Reason: Unterminated dollar quote started at position 107 in SQL CREATE OR REPLACE FUNCTION test_func1()

Pasting the generated .sql file contents into pgAdmin executes successfully. Running liquibase update runs successfully. Only execute-sql after update-sql throws the error.

Side note: Perhaps another bug is position 107 in both the changeset file and output .sql file doesn't correlate with what the error message states.