"On the TCM original frame print that I saw that change felt seamless and I couldn't see an edit. It looked like a day-for-night exposure timing change within a single shot which can be done in the lab."
I think it probably was day-for-night. I have a hi-def file of the film, and the edit is pretty clear, because the positions of Keenan Wynn (playing the bigoted senator) and the other actors suddenly change quite a bit at that moment.
