Consult an attorney, because each state is different. But be aware in many states the law tends to favor the tenants over the landlords. In this case, the section of law dealing with "reasonable maintenance and upkeep" by the Landlord is what she is trying to apply. Now that's a fairly general term, and again, consult an attorney, but I can't see how that requires you to maintain a monthly extermination contract. Reasonable would mean, to me, is there a real problem? We live in a world that has bugs, and every once in a while one makes it inside our homes. You stated there is no infestation, so I can't see the need to pay for a contract, either legally or practically.
If I was an arbitrator, I might suggest having one in every six months or so (every month is probably unnecessary under almost any circumstances). This might pacify your tenant. You can also say that you have no choice but to pass those costs along to your tenants in the form of a raise in rent, depending on the laws and conditions of the property you manage. Good luck.
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