I believe you're confusing the Lifeline program with the free smartphone program. The Lifeline program pays only for "service", not the phones themselves. And there is a Lifeline charge on every phone service bill that us consumers pay so that they can have this phone service.
Smartphones didn't exist before 2006 so it couldn't have started prior to 1996. These illegals have gotten actual free smartphones under some program started under the Obama Administration. All you have to do is ask them........and they'll tell you they got them for free under Obama.
Edit: If you look at this website perhaps they've merged or expanded on the Lifeline program to include phones now too. And if you read it, they say "a free government benefit program that offers affordable phone service to eligible Americans. Q Link gives qualifying customers their first smartphone at absolutely no cost, plus free monthly calling & data. Qualify through programs like SNAP and Medicaid, or based on your household income. Ya, we're paying for it, regardless when it was started or who started it. Either way it's a bad program that shouldn't have been mandated through the government.