In the evening, make up sponge by mixing starter, water, flour, powdered milk, and sugar. Cover with a piece of plastic and a towel. Place in a warm location overnight. In the morning sponge will be bubbly.
To make bread: stir in flour until mixture is kneedable but still quite soft. Kneed for several minutes adding flour as needed. Place in 3 greased bread pans. Let rise until doubled in bulk (1-1 1/2 hours). Bake at 400 degrees for 20 minutes. Reduce to 325 and bake for 25 more minutes. Remove from pans and cool on racks.