The quote you've got there is basically wrong.
A more correct thing to say would be that Kant believes the physical world is determined, but that rationally we are free. Or to put it another way, on the phenomenal level, all actions are determined in accordances with the laws of nature (we might in modern parlance says the laws of physics). But we need freedom in order to have moral responsibility. Thus, we are both free and determined at the same time. (This is the third antinomy).
I don't read the "refutation of idealism" the way jobermark is suggesting, which is a minority reading among Kant scholars. Instead, the section shows that time and space are not just inner conditions of my experience, but real conditions of my experience, because they occur in a way that conditions my experience before I bring to it my rational apparatus.
A key thing to keep in mind is that Kant is a skeptic about the potential for knowledge of things as they are. Conversely, he thinks we can engage in acts of understanding towards objects and perception of sensibles as we bring these under the categories of understanding and forms of sensibility respectively.
But it turns out freedom of the will is no such thing, and thus we cannot know it nor can we understand it through our categories. But we do in fact use it and have it. Thus, we are left in apparent contradiction that neither understanding nor reason can settle. As Kant will explain in his moral philosophy, we are in fact free but noumenally free. Meaning on the level of phenomena, all of our actions are determined, but at the level of will and rational action we are in fact free.
This might work out to the freedom outside of time that jobermark mentions. But I'm not sure I understand what he's saying there. Because he seems to be saying that this is freedom outside of time in the sense of having been chosen from before eternity -- but I take it to be outside of phenomenal time -- meaning it occurs in a way that is beyond our observation, even our observation of ourself. But the reason for this in Kant's picture is that we are limited to what pure reason determines we can know. And we can only know objects, and freedom is not an object. Ergo, if it occurs in time, we can never witness it. But through reason that we have freedom.