Stephen Shaw, told the annual meeting on Monday that the facility, which is used for a wide range of productions and exhibitions, had seen a transformation in its finances from the verge of insolvency to a profit of more than £10,000 in a year.
"We were operating at a loss, with a £30,000 debt to Ryedale District Council and to Garry Cooper, the former artistic director of £9,000," he added.
"With the help of our volunteers, caretaker, trustees and suppliers we have moved a long way since those dark and desperate days. The council's loan had been written off, we have begun to pay back Mr Cooper, and we have moved from a loss to a healthy profit."
Mr Shaw said a new interim business plan for the Milton Rooms had been completed and there was support by from Heritage Lottery Fund together with the Prince's Regeneration Trust.
"If we can demonstrate our ability to trade in surplus over that period, the district council has agreed to support the Milton Rooms in design costs and possibly some revenue funding as we evolve towards a more varied arts programme and building improvements," he added.
Mr Shaw said the management committee was working with producers and promoters to stage a wide range of entertainment in the main hall and studio ball and in addition, the adjoining Georgian Assembly Rooms had been given the green light to accommodate events for up to 60 people.
"I want to see the Milton Rooms as the Southern Hub for Arts in Ryedale, and to see its use by the local community strengthened," he added.
"Our vision is ambitious and aspirational but it will take more than five years to achieve. But we want local people to get involved, especially those prepared to commit themselves to become trustees."