Pat the chicken dry with paper towels and season with 1 teaspoon of salt, pepper, and garlic powder. Heat the olive oil in a large pot over medium heat. Once hot, sear the chicken for 6 minutes per side to brown the skin. (Do not cook the chicken all the way through, just enough to get a deep golden sear).
Add the water, chicken stock, thyme, and bay leaf directly to the same pot. Cover, reduce heat to low, and simmer for 25 to 30 minutes, or until the largest chicken pieces reach an internal temperature of 165°F.
Remove the chicken from the pot, strain the broth, and reserve the liquid. Once the chicken is cool enough to handle, shred the meat and set it aside.
Place the pot back over medium heat and melt the butter. Add the celery, onions, and carrots, sautéing for about 8 minutes until softened. Stir in the minced garlic and cook for 30 seconds until fragrant.
Sprinkle the flour over the vegetables, stirring continuously to coat them evenly. Slowly pour in the reserved chicken broth, whisking constantly to prevent any clumps from forming. Season with the remaining 1 ½ teaspoons of salt, cover, and bring to a simmer.
For the dumplings: In a small bowl, whisk together the dry ingredients until well combined. In a separate measuring cup or bowl, drizzle the melted butter into the cold milk and stir, it will look like tiny butter flecks or small clumps, which is exactly what you want. Pour the wet mixture into the dry ingredients and mix just until fully incorporated.
Stir the shredded chicken back into the broth and bring it to a gentle boil. Drop spoonfuls of dough onto the surface of the broth, taking care not to overlap them so they don't stick together. Season the tops of the dumplings with an optional pinch of salt and pepper.
Cover with a tight-fitting lid, reduce heat to low, and let the dumplings steam untouched for 10 minutes. Remove the lid, garnish with fresh thyme, and serve hot. Enjoy!