They're 12v so the arduino powers one lead at 5v for the signal, the ground is shared between the 5v and 12v, and finally the LED's are driven by a 12v source separate from the arduino (12v x 2a ...

The LTM8065 is a power module step-down regulator with up to 40V input voltage, which can safely operate from unregulated or fluctuating 12V to 36V input supplies in noisy environments.