Kerry Nelson said Lyndoch board member Peter Downs – who is also the Warrnambool Race Club chief executive officer – declared a pecuniary interest prior to the sponsorship deal being struck with Waterfront by Lyndoch Living for the iconic race.

Mr Downs is on the Lyndoch Living board although he is not listed as a board member on the Lyndoch Living website.

He joined the board eight months ago, well before the race club announced a three-year sponsorship arrangement in February with Waterfront by Lyndoch Living - a  business arm of Lyndoch.

Lyndoch Living is a not-for-profit organisation with a primary focus on aged care while Waterfront by Lyndoch Living is a business arm of the group.

The sponsorship - understood to be worth more than $50,000 over the three years - has raised questions in the community because of the close association with Lyndoch Living.

Under a Centrelink assessment some people have to sell their homes before being able to take up a place at Lyndoch Living.

Lyndoch Living board president  Kerry Nelson said Mr Downs did not take place in discussions relating to the sponsorship.

"Apparently the previous sponsor did not take up offer again, it was offered to Lyndoch and we saw it as a great opportunity to be part of what we see as a major community event - the May races," she said.

"Lyndoch pride ourselves in terms of community involvement. We have a long-standing relationship with the racing club."

Ms Nelson said the Grand Annual trophy had been brought into Lyndoch for residents to see over the years and members of the racing fraternity and their families had been and were residents.

"It's quite exciting really, being part of the hype and build-up to the races. The residents have embraced it," she said, adding that a retired racehorse was brought to Lyndoch on Wednesday.

"We saw the sponsorship as a good opportunity.The waterfront apartments are unique, we still have some to sell and we have the chance to market them to a wider audience through an event that receives broad coverage."

Ms Nelson said the Lyndoch Living website was in the process of being updated and that was why Mr Downs was currently not listed as a board member.

The Grand Annual was sponsored for the past four years by Wheelie Waste with the Flying Horse Bar and Brewery the previous backer of the iconic event.

When contacted Mr Downs declined to comment.

WRC chairman Ashley King welcomed the sponsorship but said probably wasn't the best person to speak to about the arrangement as he has taken a leave of absence from the club after snapping both achilles tendons in late January.

He has been wheelchair bound until last week, but is now upright with the aid of crutches and moon boots and hopes to be track side at some stage for the May races next week.