No one needs to tell Tim Marx how bad it's become at the Dorothy Day Center, St. Paul's downtown homeless shelter. He runs the place.

"People will tell you, 'I don't want to go into Dorothy Day. It stinks too much now. It's overcrowded.' That's why you're seeing people camped outside," said Marx, executive director of Catholic Charities, which owns the center. "They want to be around the services and the protection and the things we can provide to people, but they don't necessarily want to be in here because of the conditions."

Tensions have long simmered between the 30-year-old center and its neighbors, but it's worsened in recent years as homelessness has grown. Hard economic times and a tight low-income rental market have pushed the center's mushrooming homeless population well beyond what it was ever meant to handle. A tent city gathered around the overnight shelter shows help can't come fast enough.

After years of starts and stops, the city, state and Catholic Charities are betting now on a $63 million plan that would upgrade the Dorothy Day campus while a new shelter is built just up the street from the Xcel Energy Center. The old Dorothy Day site would then be torn down and replaced with a social services center offering employment and healthcare.

That's at least four years away, however. Until then, there seems to be little hope things will get better for Dorothy Day and the homeless on its doorstep.

Tents were set up near the Dorothy Day Center in downtown St. Paul nightly during the summer months. Hart Van Denburg/MPR News

That includes Leticia Bell, 52, a mother of three who can sometimes be found at dawn sleeping on the grass nearby. Sometimes dozens sleep wrapped up in tarps or camped out in rows of tents along West 7th Street.

Her last job was as cook at a Grand Avenue restaurant. Before that she worked at a hotel, but she had knee surgery earlier this summer and couldn't be on her feet. She said she and her mom can't get along and she had to move out a few months ago. She doesn't want to burden her kids.

"What do I have here? Well, I have my cardboard obviously," she said. "You have to start with a piece of cardboard. Then you put your blanket down, then you put your sleeping bag over it. And all I have is my work uniform. You know, some socks and underwear, a couple pairs of pants, my hygiene products. I've got a flashlight and an umbrella. And some books. And that's about it."

She also keeps a piece of steel rebar handy. "I sleep with that at night when I'm out here. Just in case," she said. "You never know what's going to happen. Somebody got robbed yesterday."

Dorothy Day was never supposed to be this way. It was built in 1981 with just two bathrooms, providing meals and services just during the day — with no sleeping accommodations.

Now, as many as 250 people sleep inside each night, most on mats on the floor. Dorothy Day provides 80 percent of the shelter to homeless single adults in Ramsey County. It started turning people away for lack of space three years ago.

A homeless woman sits among the sleeping mats at the Dorothy Day Center in St. Paul, Minn. Julie Siple / MPR News 2013

"This place is increasingly overwhelmed," said Marx. "We're going to have to continue to do our best, not only as Catholic Charities, but the entire community, to make the best of a very bad situation."

Bell says it's tough choosing between taking her chances sleeping on the street or in the center.

"Every time I go in there I get sick," she said. "The ventilation system is not equipped for housing people up in there. So, all night long, all you here is people coughing and in the morning, you can't breathe, you can't talk."

The homeless population in Minnesota has been rising steadily since 2006. Wilder Foundation data show the numbers up by more than 30 percent since the recession began.

Bell also thinks many of the people camping out are mentally ill and forced out of other shelter. "The social service programs aren't working here," she said. "All day long, people talk to themselves, and they're here. It's not servicing them."

Landlords have been steadily raising the bar as they screen tenants, said Dorothy Day local Anthony Torrez, adding that his criminal past, including burglary, has left him homeless for six months. "It's like everybody doesn't want to rent to somebody that's been in prison before."

Dion Pennywell stays in the open near the Dorothy Day Center in downtown St. Paul, and says he was recently assaulted in his sleep. Tim Nelson/MPR News

Others, like Dion Pennywell, say he and other poor people are simply being left behind by the changing economy.

"There's a lot of social programs, but there's nothing really being done," Pennywell said. "You got all this money, but you (still) got all these people sleeping outside."

The tight housing market has lowered rental vacancies in the Twin Cities to just 2.6 percent and all but squeezed out affordable housing, said Cathy ten Broek, the state's director to prevent and end homelessness.

"Because of how tight that is, people who are housed are often spending a huge percent of their income on housing," she said. "They're being forced into opportunities that they can't afford. We're seeing a lot of people falling into homelessness because of that."

The Dorothy Day rescue plan calls for a two-step upgrade to the campus with more than 580 beds, almost half for emergency and transitional shelters.

The first step will copy the Higher Ground facility in Minneapolis that opened near the Target Center in 2012. That facility has 336 real beds, secure storage and plenty of showers.

More importantly, it features upgrades, like an option that offers an incentive to work and save for better accommodations. There's also permanent housing and healthcare services in the same building.

The plan is to duplicate that shelter in St. Paul, just up the street from the Xcel Energy Center, then tear down the Dorothy Day, replacing it with a social services center offering employment and healthcare.

The project, known as ReVision, stalled out last year. It was initially proposed for the southern edge of St. Paul's East Side. Then neighbors and East Side officials rejected the move and sent the plan back downtown.

It's on track again, but the money isn't there yet to pay for it.

So far, Catholic Charities has just $6 million of state funds in hand and another $6 million from private donors. Housing bonds and the city are expected to help, but there are tens of millions of dollars left to raise.

In the meantime, Marx expects the crowd outside may keep growing outside Dorothy Day. The organization says it's helped more than 100 clients move into permanent housing, and more than half are moving into market-rate housing, but that's a drop in the bucket.

Catholic Charities is "shining a light about what goes on in the community here at Dorothy Day and the cost of it to the community and the benefits of doing something different," to help push changes forward, Marx said.

"After you see what goes on here today, we can't move fast enough."