"Our outlook is poor," Mr Fleming said.
"We have high capital costs we can't sustain through our own operations.
"Our facilities are tired and running into issues around earthquake strengthening. This is going to be a massive bump in the road for us and we need to expand our funding source."
Mr Fleming said the sponsorship market was "pressurised" and funding from New Zealand Racing was "continually questioned".
Contributions from gaming trusts had also become difficult to secure.
The Spring Carnival still attracted many people but perhaps not to the scale when it involved a $2 million stakes event.
"When it was a $2 million race, the ability for people to spend the discretionary dollar was greater. There was a buzz around the race which was unique and the only one in New Zealand.
"The two identities that were the driving force behind that race have fallen away and so we have lost a bit of ground."
Mr Fleming said the racing centre recognised people had fewer dollars to spend because of the tough economic time.
It had revised it costs to make it easier for families to attend events.
"The value of money we get might not be the high yield we got in the glory days but we are looking at the volume of people we need to be sustainable," Mr Fleming said.
He told the committee the centre's three spring racing events were still "the highest rated in New Zealand" and attracted the "best races horses" in the country.
Research showed a third of the people attending were from outside of Hawke's Bay which was "fresh money" coming into the region.
"It is these people who have the luxury of owning a race horse and are bringing a wallet-full of money, excuse the crudeness, and they are staying more than one night here.
"Hastings leads equine in Hawke's Bay. Racing and our venue is part of the fabric here. A wide range of community groups use it and it is a nice large green space in Hastings."
The council will make a final decision on all applications on March 26.
