On the heels of a sub-par fiscal year, New York State’s largest public pension fund has just reported another weak quarter for investment returns.

State Comptroller Thomas DiNapoli today said the Common Retirement Fund (CRF), of which he is sole trustee, had gained just 0.52 percent during the three months ending June 30, the first quarter of the fund’s 2015-16 fiscal year. The CRF finances pension benefits for nearly all non-New York City state and local government retirees, other than educational professionals.

The poor result was not a surprise, given the sideways movement in the stock market during the same period. On March 31, the S&P 500 closed at 2067. On June 30, it stood at 2063—and since then, it has barely rebounded, to 2083 as of this morning—which makes for what DiNapoli called “a challenging investment climate.” As of 2014, the CRF had allocated nearly 55 percent of its investments to foreign and domestic stocks, and another 17 percent to private equity, real estate and other higher-risk holdings.

The pension systems’ contribution rates are based on the assumption that the CRF will earn an average return of 7.5 percent.  To hit that target in what remains of fiscal 2015-16, the fund will need to earn an average of nearly 2.5 percent in each of the next three quarters.  That’s a fairly tall order, requiring an investment climate that is far less “challenging.”

The actuary for the state pension funds is expected to recommend lowering the rate of return assumption. A lower rate will require higher employer (i.e., taxpayer) contributions—but in the opinion of most economists and financial analysts, it would be far more realistic.