The New York State Board of Regents amended its policy on segregation, giving the college hope that it might retain Kendrick House as a Afro American Cultural Center (AACC) primarily housing black students, and perhaps ending a dispute that began in January 1972, when the Regents issued Position Paper No. 15, "Minority Access to and Participation in Post Secondary Education."  President Simpson wrote immediately to Commissioner of Education Ewald Nyquist, saying, "The conclusion we reach is that the new rules would explicitly authorize the continuance of the policy we have been following....  If this is not the case, we look forward to the promised site visit in the fall for further discussion."  Asked by The Chronicle of Higher Education in early August whether the new rule might exempt arrangements such as Vassar's, Commissioner Nyquist was quoted as saying "we still haven't concluded our thinking on this."

At a campus discussion of the issue on November 19 sponsored by the trustee committee on minority students, Edward Hollander, deputy commissioner of education, declared that, in the Regents' view, the AACC was "an example of institutionalized segregation" and said Vassar must find a way to integrate its students or face penalties from the Board of Regents. The following May, facing mounting legal costs and threats of both loss of state financial aid and possible rescission of Vassar's charter, the trustees voted to return Kendrick House to its original purpose—faculty housing—to relocate the cultural center to a site on campus and to house all black students in campus residence halls. Vassar and Cornell University were the last institutions of higher education in New York State to relinquish the position that mixed campus housing where African American students were in the majority did not constitute segregation.