The "Declined SBA Award Policy" is found on page 52 of the manual you refer to in your email below.
This is the current policy:
"Applicants who have applied for an SBA loan but have a record of declining the loan or have not executed the SBA loan may be considered for RLHP funding, but awards will be adjusted to account for any SBA DOB.
If a low to moderate income (LMI) household has declined an SBA loan, a hardship will be presumed and the SBA loan will not be considered a duplication of benefit. SBA loan declination is defined as an applicant having never executed the SBA loan documents."
When the "verification" paragraph states: RHLP Declined SBA Award Policy - it is referring to the paragraph above it in the manual (see snip image below).