Criminal Sentence 436: Down with Bedbugs

From an online article about bedbugs (New York is number one in the USA):

"But it [Terminix] said the appearance on its list of smaller cities shows the insects that live in furniture, clothing and luggage, are getting a grip on the U.S. heartland."

This is a very awkward sentence, especially when it comes to the commas. There's also a problem with the word "that." Let's fumigate this sentence:

"But it said the appearance on its list of smaller cities shows the insects, which live in furniture, clothing and luggage, are getting a grip on the U.S. heartland."

That rewrite gets rid of the the immediate problems, but the sentence still sucks. Let's fumigate it further:

"But the insects, which live in furniture, clothing and luggage, appear to be getting a grip on the U.S. heartland, since they are showing up in smaller U.S. cities."