Funded projects
OFSET - www.ofset.org

Well all previous governmental projects are funded, but there are more:

Skolelinux by SLX Labs
http://www.skolelinux.org
A-gnu-la by European Union FP 
http://www.agnula.org
Gnu LinEx by European Feder plan
Freeduc by Unesco and local agencies
http://www.ofset.org/freeduc-cd
http://www.ofset.org/press