A plan to absorb the site into surrounding suburbs would scrap horse racing to make room for a green corridor of trees and outdoor play spaces.

Housing, retail facilities, cafes, medical services and amenities would be developed on the Lyneham block under the draft inner north and city district strategy proposal. It is one of two options presented. The second keeps the racecourse in the same location.

Published on Melbourne Cup day, the biggest day on the racing calendar, the proposal follows months of discussions with the Canberra Racing Club, as the club seeks to diversify its revenue.

The club had sought to develop the 17 hectares of land around the racecourse. It is understood it was unaware the ACT government was considering a racecourse-free Thoroughbred Park.

The club's development plan included a mixture of residential and commercial accommodation, potentially with a hotel and an aged-care facility.

Canberra Racing Club declined to comment, as management were too caught up in cup day celebrations to get across the proposal.

Despite the plan stating the racecourse would be retained until an alternative site was found, the ACT government confirmed it had not begun looking at other options.

It intended to continue working with Canberra Racing Club on development proposals at Thoroughbred Park, a spokeswoman said.

The Canberra Liberals racing spokesperson Mark Parton called the timing of the plan's release "an utter disgrace".

"What we see here is clear proof that the ACT is genuinely staring down the barrel at being the only jurisdiction in Australia without horse racing," Mr Parton said.

"There was no consultation whatsoever with the race club, they were absolutely blindsided. And you can imagine that they're knocked for six by this.

"To release a very clear plan to end racing in the ACT on Melbourne Cup day is actually cruel."

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The second option put forward by the ACT government keeps the racecourse, with residential and commercial development also going ahead.

Higher density housing would be established close to light rail stops, with lower density housing in less accessible areas.

Future development would front the Federal Highway, Flemington Road and light rail, "creating a compact new centre offering recreation and commuter choice while retaining the racecourse."

Greens leader Shane Rattenbury said the party was keen to hear from the community on all the district plans including the proposals for the park.

The ACT Greens do not support public funding for the horseracing industry and have pushed the government to move away from subsidies.

The Greens are seeking a reduction in racing funding in the short term and an end to all funding in the long term.

An ongoing stoush has previously lead to the Canberra Racing Club calling for an end to attacks.

Mr Rattenbury said the Greens would respond to specific feedback at the end of the consultation process.

The two concepts have been released for public discussion, with planning subject to further investigation and consultation.

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The proposals were issued as part of the ACT government's new territory plan, which includes a series of district planning strategies as part of its planning system review and reform.

Minister for Planning Mick Gentleman said the district strategies were a new layer in the ACT's planning system, guiding growth and change at a local level, according to the unique characteristics of each district.

"We know, for example, the employment and education needs in Tuggeranong differ from those in Belconnen, just like the environmental and cultural assets in the Inner North are different from those in the Molonglo Valley," he said.

The ACT government will run a range of consultation sessions in every district in the coming month and early in the new year.

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