Weren't acting on their own overt prejudice sounds very close to what I was intending to say. They didn't say, "We didn't know there'd be black kids," they just had members complaining, likely realized the complaints were racist, but went along with it because of monetary concerns and possibly cowardice.

And I also agree on the 'racist, but' part. I didn't mention it above but it reminded me of the MU scene regarding the campus cops and weapon checks. That sort of 'soft racism' where it's rationalized as not being racist, yet doing things that are racist anyways because you can think up a rationale to justify it to yourself.