Endangered species are often found on wildlife refuges, but they aren't always the sole reason for establishing a refuge The big picture is preservation of wild lands for wildlife and to prevent land from being developed or otherwise damaged by human activity.
The Department of the Interior is the top controlling agency that manages the National Refuge System. The State in which the refuge is placed may have some voice/opinion as to the designated area if the area is slated to include State property, but ultimately the land is managed by the Feds. It usually isn't something put to a public vote, but decisions made in offices by executive personnel. Some wildlife refuges are even found on military bases where the State has no say at all, because the military land is under control of the Federal government.
Why do they go where they go? The DOI and it's sub agencies (like the USFWS) makes up a big bureaucracy of which some decisions are based in sound scientific fact, and others based on gut feelings, some decisions are simply arbitrary, and some are made to work within the system to allow for Federal land in one area to be developed in exchange for preserving Federal land in another area as a National refuge. Kind of like the whole "carbon credit" scheme that is supposed to stop global climate change.
The rules and regulations that have come from the DOI would make your head spin.