Isn’t it still a net loss of revenue if everyone moves out of your city and refuses to visit because of your soft on crime reputation?
It sounds like that could be Someone Else's Problem from the perspective of a District Attorney. It plausibly looks good to somebody that the DA is minimizing prison costs regardless of second-order effects of policies which minimize prison costs.
DA has a bully pulpit they could use to petition for building more jail space, but no direct control of that. Also it takes years to build more jail space. Prisons/jails are incredibly expensive to build and operate.