At least in North America, the locations have been determined by Ironman North America who organizes all the races except for the new IM Louisville. Anticdotally, it has seemed like they usually like to strike a deal with a city for 5 years, then renew it for another 5 years if everyone's happy (IMNA, host city and athletes). The exception has been Utah which obviously didn't work out and that event was moved to Coeur d'Alene after only one year in Utah (2002 I think). Penticton, Lake Placid and Panama City have apparently worked well and have stayed put for awhile (25 years for Penticton, not sure about the others). I think Arizona and Coeur d'Alene are still in their first 5 year cycles with IMNA while Madison is now in its second 5 year deal.

I'm sure I'm off a tad in there somewhere - but that's the jist of it.