Saute onions in butter until limp. Add rice, sourcream, cottage cheese, bay leaf, salt & pepper. Mix well. In greased cassarole dish, put a layer of rice mixture, a layer of chilies (seeded and cut into strips), and 1/2 cup cheddar. Repeat (save 1/3 C cheddar) ending with a layer of rice. Bake for 25 min in 375F oven. Top with remaining cheese, and bake 10 more minutes