It is behaving just the way it should. It’s just that how you print the query.
from sqlalchemy.dialects import postgresql
query = statement.compile(dialect=postgresql.dialect(),compile_kwargs={"literal_binds": True})
print(query) # will print the compiled query statement againt the dialect.
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solved How to print the ACTUAL SQLAlchemy query to troubleshoot: SQLAlchemy filter statement replaces filter critieria with %(column_name_1)s