I am surprised there is not actual article covering this specific subject (money).

in short - a coop needs to act as fast as possible to contain any reported cases: if they do this, they will not have large costs due to the fact the bugs can so easily spread and may be also able to bill the resident for remediation. However, a wise coop will encourage people to report a case asap and not threaten to bill them UNLESS it spreads and they have not reported it in which case they could get a huge bill - get my drift.

2) residents need to report any signs of bugs asap and demand the coo. send in reputable experts - then they will be off the hook and the coop is liable if it spreads to any neighboring apartments.

Q: What is a Cooperative’s Responsibility for Eradication of Bedbug Infestation?

A: After practically disappearing since the early 1900’s, bedbugs are staging a comeback in apartments, hotels and homes throughout the United States. However, since 2004, there have only been a few reported cases in New York directly ruling on the issue of bedbugs and none of these cases deal directly with cooperatives.
Responsibility for eradication of bedbug infestation in a cooperative should generally be determined by the provisions of the proprietary lease. The proprietary lease makes a shareholder responsible to keep the interior of the apartment in good repair while the coop is responsible for keeping the building in good repair. Therefore, a shareholder should be responsible for remediating bedbug infestation within his own apartment. There is one exception, namely, the warranty of habitability which is a warranty read into every residential lease, including coop proprietary leases. The warranty of habitability requires that an apartment be fit for human habitation and free of dangerous conditions and may obligate a coop to remediate infestation unless the shareholder’s personal property is demonstrably the source of the infestation. If the infestation is limited to one apartment, chances are that the shareholder brought the bedbugs into the apartment and the warranty of habitability would be inapplicable because the law provides that if the condition at issue is caused by the tenant, the warranty is not breached. However, where multiple apartments are infested and it is difficult to identify the source of the infestation, remediation may become a Board responsibility.
By Albert F. Pennisi of the law firm of Pennisi, Daniels & Norelli, LLP, a law firm that represents Cooperatives and Condominiums located in Rego Park, Queens, New York