TPM has the details on this. As usual, the public statement from Palin:
"As mayor I took a voluntary pay cut, which didn’t thrill my husband; and then as governor I cut the personal chef position from the budget, and that didn’t thrill my hungry kids."
And as usual, the different reality:
As a Council member she voted against hiking the mayor’s salary from $64,000 to $68,000, but it passed anyway. When she came in as mayor, she passed the ordinance which brought her salary down to $61,200. But that may not actually have taken effect, and Council-mandated raises brought her actual salary up to $68,000.