Self-increasing = hard time cap? (maximum turns?)
A problem I see with Fear Levels, though, is that implementing it might require to make it a central element in the game, not just a timer with a fancy name
The major gameplay elements are Control, Influence and Movement (Combat and Economy, also). I can see ways Fear Levels help/hamper each of those elements, and I can see many implementations that might encourage passive/defensive/turtling gameplay (keeping FLs down until you're ready to win).
I wonder if it's possible to make Fear Levels distinct enough to add a layer of complexity without breaking the game, all while interacting with other mechanics, or adding an overarching objective that goes beyond control of the city (that pretty much was the point of Victory Points: having Outfit specific objectives to achieve).
For now, I think house rules are the way to go I'm going to think of something for the next weeks. High FLs might reduce cost/upkeep of Abominations, make Harrowed dudes crazier(extra bullets), give more influence to truly horrific Abominations. Low FLs might make Miracles/Spirits easier to perform, lower Abominations' influence, make Harrowed dudes tougher (count for an extra casualty).
Maybe the 4th ring could only increase Fear Levels (and benefit from a high FL), while Eagles Wardens could only decrease it (and gain Victory Points). Morgan's mad scientists could do anything "accidentally", and Law Dogs, Sloane Gang could go both ways (having access to Blessed, Hucksters and Mad Scientists). The 108 bandits... dunno about them yet