BUG #5032: unexpected syntax error for plpgsql function returns table

The following bug has been logged online:

Bug reference: 5032
Logged by: Keith Cascio
Email address: keith(at)cs(dot)ucla(dot)edu
PostgreSQL version: 8.4.0
Operating system: CentOS 5.3 (Linux)
Description: unexpected syntax error for plpgsql function returns
table
Details:

Do this:
create function reproduce() returns table(foo integer) language plpgsql as
'begin return query select 1 foo; end;';

Output I got:
ERROR: syntax error at or near "$1"
LINE 1: select 1 $1
^
QUERY: select 1 $1
CONTEXT: SQL statement in PL/PgSQL function "reproduce" near line 1

Output I expected:
CREATE FUNCTION

The mechanism of this error involves the "foo" return column and the "foo"
alias being identical. Identifier collision? If I change one of the "foo"s
to "bar", the definition succeeds. There are fancier ways to cause similar
unexpected syntax errors, but this is close to a minimal example.