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The person responsible for the payment related to the bed bugs is the person responsible for bringing them into the property. Since this can be almost impossible to ascertain it normally means the landlord will ultimately be responsible for the cleanup. If this is a stand alone house then that is much easier to prove. If this is an apartment complex then it is much more difficult. If there is no other apartment with bed bugs then your exterminator can probably pin point the cause as your tenant, you will need to contact them and have them provide any evidence. If you do get this evidence then you might be able to bring a claim against your tenant and have them be responsible for any damages and cleanup fees. At this point the tenant cannot withhold rent if you were not given written notice of the defect and a chance to remedy it. As you did in fact do that, the tenant should not be able to withhold rent especially if they were the cause of the bed bugs. Eventually if the problem is not solved a tenant can withhold rent but in this circumstance you have evidence showing that you did try to fix the problem and had no notice that it was not solved. You could evict your tenant based on nonpayment but this is a bit difficult as the courts could see this as a retaliatory eviction. The California courts favor tenants so it might be more problem than it is worth to fight this. I would consult a local attorney and ascertain your rights and look at the situation with more detail. You do have some facts on your side but there is a very good chance the tenant could prevail in this circumstance.
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