Common Man Games
It's separate from the CPD, but for what purpose? I thought the punks went off the board after arrest. The rules also mention "basic detainees" and "difficult criminals."
You are referring to the Unterbelly (back side of the board), which is a new aspect of the game (2nd Edition).
In the Unterbelly, there are holding cells at the station to contain the criminal population as they are initially being processed through the system, and in some cases low security-risk individuals.
For the most part, those who will be in longer periods (not released that same day), were then transferred over to the Jail.
If you read certain Event Cards, then it will start to make more sense...
In the base-game it is the location of the "Jail Break" (3rd Street North).
The Station is where the Detainees Run Amok.
We will likely add more Events down the road for the Jail and even for the newest location, The Water Tower.
PS - In the original version of Police Precinct (see the standard side of the board), the CPD had a tighter budget and needed to make due without the jail. This meant housing ALL in the Station, which caused frequent overcrowding and high levels of tension (especially when rival gangs where present within)!