Why would a program make a national Call for Artists instead of a local Call? What are the reasons for expanding (or restricting) Calls to specific geographical regions?

Calls for Artists are typically open to all artists to allow the widest inclusion of experienced and qualified professionals to create artwork. Sometimes a public art program may geographically restrict the Call, limiting eligibility to artists from the city, county, or state. Occasionally, those restrictions are made to ensure the funding benefits artists from a particular region. There is also precedent for programs instituting geographic and experience-based restrictions for low budget projects, which helps emerging artists obtain their first commission and thus improves their ability to compete for projects nationally.  
However, geographically restricting Calls can result in other programs doing the same, which has the less favorable effect of reducing competition and excellence across commissions. So, ideally, public art programs should open their Calls to a national talent pool unless there are compelling reasons for restricting it.