What's the confusion? The US is a federated system, each state is responsible for determining and carrying out the punishments for crimes committed within that state. Some offenses will result in federal charges, in addition to or instead of state-level charges, so those sentences and punishments would be handled by the federal government instead. Prisoners charged with crimes at the state level will typically be held in prisons in that state. Prisoners convicted of a capital offense (one that can result in the death penalty) in some state will be held in a prison in that state on "death row" (colloquial term meaning a section of a prison dedicated to inmates sentenced to death).

The quoted bit is just literally saying that CA has more death row inmates than other states. That doesn't mean they sentence more people to death, a large part of the reason is that they haven't carried out an execution in 20 years. So the numbers will continue to grow instead of shrinking until the inmates die from some other cause (age, illness, suicide, etc.). This is in contrast to states like FL and TX that continue to carry out death sentences, so the numbers will grow as people get sentenced but shrink faster than in CA as they carry out the executions.