Students learn a lot from doing the open-source project, but it takes a lot of time to set up. Start work on this early!
Check out these Github repositories. See the issues and the "help wanted" tag.
You can also politely email the developers to ask about appropriate projects: the last version of the class had success with this approach. There are some awesome developers out there :) Cc me on initial emails with developers.
I'll add more projects to this list as I find them.