Chicago Mashed Potatoes w/ Onion & Bacon

Source: Birds of a Feather Bed & Breakfast Ltd

4 slices bacon, chopped
1 large onion, chopped
3 pounds all-purpose potatoes (about 9 medium), peeled and cut into 1-inch chunks
1 bay leaf
1 teaspoon salt
1/4 teaspoon coarsely ground black pepper
1 cup milk, warmed

In 10-inch skillet, cook bacon until browned over medium-low heat. With slotted spoon, remove bacon to paper towels to drain. To bacon fat in skillet, add onion and cook over medium heat, stirring occasionally, until tender, about 15 minutes. Meanwhile, in 3-quart saucepan, heat potatoes, bay leaf, and enough water to cover to boiling over high heat. Reduce heat to low; cover and simmer 15 minutes or until potatoes are fork-tender; drain. Return potatoes to saucepan. Discard bay leaf. With potato masher, mash potatoes with salt and pepper. Gradually add milk; mash until mixture is well blended. Stir in onion and bacon.