Yeah... Funk is defo still kicking. There is a whole festival in florida dedicated to it.
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Lettuce
Galactic
Soulive
George Porter's Running Padners
Dumpstaphunk
etc.
There is a **** load out there, just get a shovel.
Also big up to Pimps of Joytime, that guy writes some *honest* funky tunes, straight outta the '70's vibe there.
Lettuce is funky for sure but can get a bit rock-esque too, Galactic has more New Orleans and other influences and can also delve into some not-completely-funky complexity during jam/solo sections- not to say I don't like it, I love it, but it's not what I would call "uncut funk".
Soulive, which I love to death, is funky but also very jazzy, not straight up funk but definitely "good to ya". They're just an amazing band. I see them at the forefront of jazz that's extremely groovy more than being a funk band, but forget labels, just check them out, they are exceptional.
Dumpstaphunk is some of the nastiest funk ever, just wish they had some better tunes/hooks to hang their killer grooves on.
It's funny but these are all bands whose CDs I buy and who I go see play live. I would only categorize a few as funk bands, but I would say they are all jam bands. They are in the jam band festival scene for sure.
George Porter is royalty as far as I'm concerned, hated hearing what happened to PBS, and can't wait to see the Runnin' Pardners when they come around here.