I think you copied this function from jinja2 codebase, if that's the case here are a couple of things I'd do:
 * Add to the docstrings pointers to the original source and credit the appropriate people / teams
 * Add into the docstrings the reasons behind your decision. I know that you found a bug the urlize filter of the jinja2 library that we're currently using and that's something that needs to be clearly explained here so in the future we can remember what and why it happened.

Having said those, I'd go ahead and remove this function altogether. Instead I'd code a simple function that just urlizes a string. It doesn't have to support things that we're not going to use, like trimming, no nofollow or multiple urls in one string.

With this simple function (let's call it `simple_urlize`) you will not need the template either :)