Urban renewal is funded by tax increment financing (TIF). At the time an urban renewal plan is adopted, the county assessor calculates the total assessed value of the area and establishes this value as the "frozen base" for the area.
Taxes from that frozen base continue going to all of the taxing jurisdictions. Growth above the base is called the "increment". Taxes from the increment, called tax increment revenue, go to the urban renewal agency for projects within the urban renewal area.