Actually, I've seen far more racism in the rural/small town north than I've ever seen in the south. And I have lived in the smallest of small southern towns. It probably has little to do with where precisely the town is located and more to do with what is happening (sudden influx of other races).
Go to small towns in the south and see how white people live. Poor is poor.
Disclaimer: I've only really lived in TN, and NC in the south and rural NY in the north. In laws are in small town IA (which as a southerner I classify as "north").